Operating at or near full capacity will require a firm considering a "special sales order" to potentially recognize the:
A) Opportunity cost from lost sales.
B) Value of full employment.
C) Use of operating leverage.
D) Likely increase in terms of the fixed cost associated with the order.
E) The amount of facility-level cost drivers.

Question

Quizplus · Accepted Answer

Operating at or near full capacity means the firm does not have excess capacity to fulfill special sales orders without sacrificing regular sales, thus potentially losing out on revenue and profits (opportunity cost).

Operating at or near Full Capacity Will Require a Firm