Existing fixed manufacturing overhead costs are not relevant in deciding whether to accept a special order.

Name: Existing fixed manufacturing overhead costs are not relevant in deciding whether to accept a special order.
Brand: Quizplus
Rating: 4.8 (27 reviews)

Question

Quizplus · Accepted Answer

Existing fixed manufacturing overhead costs are sunk costs and are not affected by accepting or rejecting a special order. Only the incremental costs and revenues specific to the special order are relevant in making the decision.

Existing Fixed Manufacturing Overhead Costs Are Not Relevant in Deciding