Accepting a Special Order Will Improve Overall Net Operating Income

question 230

Multiple Choice

Accepting a special order will improve overall net operating income if the revenue from the special order exceeds:

• A) the contribution margin on the order.
• B) the incremental costs associated with the order.
• C) the variable costs associated with the order.
• D) the sunk costs associated with the order.

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Definitions:

Unconditioned Stimulus

In classical conditioning, an initially neutral stimulus that automatically triggers a reflexive response without any need for prior learning.

Classical Conditioning

A teaching process in which two stimuli are repeatedly linked; a response that is initially prompted by the second stimulus becomes prompted by only the first stimulus over time.

Observational Learning

Learning that occurs by observing and imitating the behaviors of others.

Observational Learning

Learning that occurs through observing the behaviors of others and the outcomes of those behaviors.