In analyzing costs to decide whether to accept a special order, total fixed costs should be investigated to see how much fixed manufacturing costs per unit will be changed by the special order.

Question

Quizplus · Accepted Answer

Fixed costs do not change with the level of production, so they are not relevant when analyzing a special order. Only variable costs and any additional fixed costs directly attributable to the order should be considered.

In Analyzing Costs to Decide Whether to Accept a Special