A Box of Cascade Dishwasher Detergent Shrink-Wrapped with a Bottle

question 275

Multiple Choice

A box of Cascade dishwasher detergent shrink-wrapped with a bottle of Jet Dry is sold for $1.50 less than the regular price of the products sold separately. This is an example of ________ pricing.

• A) penetration
• B) prestige
• C) bundle
• D) odd-even
• E) standard markup

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Definitions:

Allowance Method

An accounting technique used to estimate bad debts and adjust accounts receivable to reflect only receivables expected to be collected.

Uncollectible Account

A receivable that a company has deemed unlikely ever to be collected and is therefore written off as a bad debt expense.

Trade Accounts Receivable

Amounts owed by customers to a business, specifically from sales transactions.

Net Realizable Value

The estimated selling price of goods, minus the costs of their completion and sale.