When a company does not have sufficient capacity to fill an order for less than the current selling price, what additional factor must be taken into consideration?
A)The decision process is the same whether there is sufficient capacity or not.
B)How will the lack of capacity affect the quality of the product.
C)Can resources be transferred from producing product to sell at the current price to producing product at the special price?
D)Opportunity costs

Question

Quizplus · Accepted Answer

When a company does not have sufficient capacity to fill an order for less than the current selling price, the additional factor that must be taken into consideration is opportunity costs. The company must analyze if the resources that will be used to fill the discounted order could have been utilized to generate more revenue through other sales.

When a Company Does Not Have Sufficient Capacity to Fill