In deciding whether to accept or reject a "special sales order," managers need critical information about all the following except:
A) Relevant costs.
B) Prior period operating costs.
C) Any opportunity costs associated with accepting the order.
D) The strategic, competitive environment of the firm.
E) Alternative uses of existing capacity.

Question

Quizplus · Accepted Answer

Prior period operating costs are not relevant in the decision-making process for accepting or rejecting a special sales order. The focus should be on the relevant costs, such as incremental costs, opportunity costs, and alternative uses of existing capacity, as well as the strategic, competitive environment of the firm.

In Deciding Whether to Accept or Reject a "Special Sales