Organisation-sustaining costs should be allocated to:
A)evaluate distribution-channel managers.
B)determine the selling price that will cover all costs.
C)identify the most profitable customers.
D)motivate changes in customer behaviour.

Question

Quizplus · Accepted Answer

Organisation-sustaining costs are overhead costs that are not directly related to a specific product or customer, such as rent for the office, salaries of executives, etc. These costs should be allocated to determine the selling price that will cover all costs. This will ensure that the product or service is profitable and sustainable in the long run. Evaluating distribution-channel managers, identifying profitable customers, and motivating changes in customer behavior are all important aspects of marketing strategy, but they do not directly relate to organisation-sustaining costs.

Organisation-Sustaining Costs Should Be Allocated To