The Reasons for Using the Variable Cost-Plus Approach Include All

question 54

Multiple Choice

The reasons for using the variable cost-plus approach include all of the following EXCEPT this approach:

• A)avoids arbitrary allocation of common fixed costs to individual product lines.
• B)is more consistent with cost-volume-profit analysis.
• C)provides the most defensible bases for justifying prices to all interested parties.
• D)provides the type of data managers need for pricing special orders.

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Definitions:

Holder in Due Course

A person who has acquired a negotiable instrument in good faith and for value, thus having certain legal protections.

Non-negotiable Instrument

A financial document whose terms cannot be altered or transferred in favor of someone other than the stated payee.

Holder

In a financial context, a person or entity that possesses or owns a negotiable instrument, like a check or bond, and has the right to enforce the instrument.

Negotiable Instrument

A legal document guaranteeing the payment of a specific amount of money, either on demand or at a set time, with the payer named on the document.