Which of the Following Costs Is NOT Relevant to a Special-Order

question 10

Multiple Choice

Which of the following costs is NOT relevant to a special-order decision?

• A)the direct labour costs to manufacture the special-order units
• B)the variable manufacturing overhead incurred to manufacture the special-order units
• C)the portion of the cost of leasing the factory that is allocated to the special order
• D)All of the above costs are relevant.

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Definitions:

Periodic Interest Rate

The interest rate charged or earned over a particular period of time, often expressed as a percentage.

Annual Percentage

Often referred to in context of the annual percentage rate (APR), it represents the annual rate charged for borrowing or earned through an investment.

Return Requirement

The minimum rate of return an investor expects to achieve on an investment, influencing the types of assets included in their portfolio.

Cash Flows

The aggregate money movement into and out of an enterprise, significantly impacting its cash on hand.