Which of the following statements regarding special orders is (are)true? (A)The primary decision for special orders is determining whether the differential revenue is greater than the differential costs associated with the order.
(B)The differential analysis approach to pricing for special orders could lead to underpricing in the long-run because fixed costs are not included in the analysis.
A)Only A.
B)Only B.
C)Neither A nor B is false.
D)Both A and B are true.

Question

Quizplus · Accepted Answer

Special orders require analyzing if the additional revenue exceeds additional costs (A), and excluding fixed costs in pricing can lead to underpricing over time (B).

Which of the Following Statements Regarding Special Orders Is (Are)true