The most intensive cost analysis on a product basis occurs with ________.
A) price lining
B) variable pricing
C) direct product profitability
D) a variable markup policy

Question

Quizplus · Accepted Answer

Direct product profitability (DPP) is a cost analysis technique that calculates the profitability of a product by identifying all the direct and indirect costs involved in its production and sale. This technique helps a company to determine which products are most profitable and which ones may need pricing adjustments, promotions, or improvement in efficiency to maximize profitability. Price lining, variable pricing, and variable markup policy do not involve the same comprehensive analysis of direct and indirect costs as DPP.

The Most Intensive Cost Analysis on a Product Basis Occurs