Differential costs are relevant when making which of the following types of decisions?

Question

Quizplus · Accepted Answer

Differential costs are relevant in all of the mentioned types of decisions. When pricing special orders, it is important to consider the additional costs or savings compared to regular production. When deciding to drop or add a product, the differential costs between keeping or eliminating the product must be considered. Similarly, when determining whether or not to further process different products, the potential additional costs and benefits of doing so compared to not processing must be evaluated using differential costs.

Differential Costs Are Relevant When Making Which of the Following