Which of the following statements is most accurate?
A)Nonprofit organizations are exempt from having to cover the costs of producing and/or marketing their products.
B)Socially responsible corporations should have the pricing constraint of covering all costs of producing and marketing their products,but they should not price their products to earn a profit.
C)Regardless of a company's objectives,a firm must cover all the costs of producing and marketing a product or the firm will fail.
D)Price elasticity of demand makes it virtually impossible for companies to cover all their marketing and production costs at all times.
E)Marketing and production costs are the most difficult and expensive aspect of pricing because they draw so much capital away from other departments in the organization.

Question

Quizplus · Accepted Answer

This statement reflects the basic principle of cost accounting, which is that a company must cover all costs of production and marketing in order to be financially viable. Failure to do so will lead to losses and eventually bankruptcy. Companies may have varying objectives, but the fundamental need to cover costs remains constant.

Which of the Following Statements Is Most Accurate