Which of the following statements regarding special orders is (are) true?
(A) The primary decision for special orders is determining whether the differential revenue is greater than the differential costs associated with the order.
(B) The differential analysis approach to pricing for special orders could lead to underpricing in the long-run because fixed costs are not included in the analysis.
A) Only A.
B) Only B.
C) Neither A nor B is true.
D) Both A and B are true.

Question

Quizplus · Accepted Answer

The primary decision for special orders involves comparing differential revenue to differential costs, and excluding fixed costs in pricing can lead to underpricing in the long run.

Which of the Following Statements Regarding Special Orders Is (Are)