Which of the following best describes the impact of undercosting in the allocation of production costs? I don't think this info is necessary for the question. Perhaps add to the question something like: impact of undercosting in the allocation of production costs.Agree. Change made. JMF
A)This is a goal of all companies because undercostingall products allows for larger profit margins.
B)Companies will use target pricing to undercost products.
C)Undercosting some products will lead to overcosting other products, which may then become overpriced and lose market share.
D)Undercosting some products can lead to overcosting other products, which is acceptable because it all balances out in the long run. I don't think this info is necessary for the question. Perhaps add to the question something like: impact of undercosting in the allocation of production costs.Agree. Change made. JMF

Question

Quizplus · Accepted Answer

Undercosting some products may lead to overcosting other products in the allocation of production costs. This can cause those overcosted products to become overpriced and potentially lose market share. In order to avoid this negative impact on overall profitability, companies should strive to accurately allocate production costs to each product.

Which of the Following Best Describes the Impact of Undercosting