When Target Costing Is Used,the Target Cost Is Determined By

question 2

Multiple Choice

When target costing is used,the target cost is determined by:

• A)finding the difference between the market price and the amount of profit needed to satisfy stakeholders.
• B)adding the cost of direct materials,direct labor,and activity costs of a product.
• C)subtracting all nonvalue-added costs from total manufacturing costs of a product.
• D)adding the manufacturing and nonmanufacturing costs of the product.

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Definitions:

Negative Reinforcement

A behavioral principle where the removal of an unpleasant stimulus following a desired behavior increases the likelihood of that behavior being repeated.

Positive Reinforcement

The addition of a rewarding stimulus following a behavior, intended to increase the likelihood of that behavior reoccurring.

Behaviorism

A branch of psychology that focuses on (relatively) simple explanations for outward behavior and is unconcerned with the inner workings of the mind.

Social Learning Theory

Social learning theory proposes that new behaviors can be acquired by observing and imitating others, highlighting the importance of social influences on learning.