Which of the Following Is an Advantage of Using Full

question 2

Multiple Choice

Which of the following is an advantage of using full cost of the product as the cost base?

• A) Managers are informed regarding the minimum long-run cost they need to recover to stay in business.
• B) Using the full cost of the product as a basis for pricing increases the temptation to cut prices below full costs.
• C) Fixed cost allocations can be arbitrary while using full cost of the product as the cost base.
• D) It requires a detailed analysis of cost behavior for computations and hence promotes a better understanding of the cost behavior.

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Definitions:

External Outputs

Outputs from a system or device that are directed outwards to other systems, devices, or users, distinct from internal outputs that might be used within the system itself.

Sequencer Instruction

A command in PLC programming that manages a series of steps or sequences in a process control application.

Binary Information

Binary information consists of data in the form of two possible states, often represented as 0s and 1s, which is the fundamental building block of digital computing and digital logic.

Sequencer File

A file type used in automation and control systems that contains a series of steps or instructions to be executed sequentially, often used for complex or repetitive tasks.