Direct costing is extremely useful in setting prices of products in special-order situations.

Question

Quizplus · Accepted Answer

Direct costing only takes into account variable costs, which are directly related to the production of a product. This makes it easier to calculate the cost of a special-order product, as only the direct costs need to be considered. Therefore, direct costing is useful in setting prices of products in special-order situations.

Direct Costing Is Extremely Useful in Setting Prices of Products