Which of the Following Is a Profit-Oriented Approach to Pricing

question 256

Multiple Choice

Which of the following is a profit-oriented approach to pricing?

• A)skimming pricing
• B)target pricing
• C)loss-leader pricing
• D)target profit pricing
• E)standard markup pricing

---

Definitions:

Denominator Activity

A term used in cost accounting to refer to the level of activity used to allocate fixed costs to cost units.

Variable Overhead Efficiency Variance

The difference between the actual variable overhead based on hours worked and the standard cost of variable overhead for those hours, indicating efficiency in controlling variable overhead costs.

Variable Manufacturing Overhead Cost

The portion of manufacturing costs that varies with the level of production output, including costs such as indirect materials and utilities.

Standard Hours Allowed

The amount of time that should be taken to complete a specific amount of work, according to predefined standards.