In deciding whether to undertake a special order at a reduced price:
A) the effect on existing customers should be considered.
B) whether the order will make a contribution to fixed costs should be considered.
C) the opportunity cost of forgone regular sales should be considered.
D) all of the options should be considered.

Question

Quizplus · Accepted Answer

All of the options should be considered when deciding whether to undertake a special order at a reduced price. The effect on existing customers is important to consider to ensure that they are not negatively impacted. Whether the order will make a contribution to fixed costs is important to consider to ensure that the reduced price will still result in a profit. The opportunity cost of forgone regular sales is important to consider to ensure that the reduced price does not result in overall losses for the company.

In Deciding Whether to Undertake a Special Order at a Reduced