In making special order pricing decisions, generally only unit costs and batch-costs need to be considered assuming excess capacity exists.

Name: In making special order pricing decisions, generally only unit costs and batch-costs need to be considered assuming excess capacity exists.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

When there is excess capacity, only the variable costs (unit and batch costs) are relevant for special order pricing decisions, as fixed costs are already covered by existing operations.

In Making Special Order Pricing Decisions, Generally Only Unit Costs