Which of the following is true of freight absorption pricing?

Question

Quizplus · Accepted Answer

Freight absorption pricing refers to a pricing strategy where the seller absorbs some or all of the freight charges instead of passing them on to the customer. Therefore, option A is the correct choice as it states that the seller picks up all or part of the freight charges. Option B is incorrect because it suggests the application of a standard freight charge to all customers, which is not related to freight absorption pricing. Option C is also incorrect as it indicates that the freight charge is calculated based on an average cost and not related to any strategy. Option D is incorrect as it contradicts the concept of freight absorption pricing, as the seller must absorb some or all of the freight charges.

Which of the Following Is True of Freight Absorption Pricing