What Cost Concept Used in Applying the Cost-Plus Approach to Product

question 126

Multiple Choice

What cost concept used in applying the cost-plus approach to product pricing includes only total manufacturing costs in the cost amount to which the markup is added?

• A) variable cost concept
• B) total cost concept
• C) product cost concept
• D) opportunity cost concept

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Definitions:

Salt Deposits

Concentrations of salt left behind when water evaporates, forming layers underground or on the surface.

Less Dense

Describes a lower mass per unit volume of a substance, often causing it to float atop more dense materials.

Continental Crust

The thick part of the Earth's crust that forms the large landmasses, typically composed of less dense rocks like granite.

Continental Slope

The steep slope extending from the outer edge of the continental shelf down to the continental rise or the ocean floor.