Buyers Will Focus on "Lowest Price" Because

question 73

Multiple Choice

Buyers will focus on "lowest price" because:

• A)Their personal success is influenced by purchasing at the lowest price.
• B)The responsibility of presenting the rationale to management for purchasing at a higher price creating anxiety.
• C)They don't want to address the specific issues.
• D)All of the above.

---

Definitions:

Absorption Costing

is an accounting method that includes all manufacturing costs (direct materials, direct labor, and both variable and fixed overhead) in the cost of a product.

Fixed Manufacturing Overhead

The set costs involved in the production process that do not change with the level of output, such as salaries and building leases.

Inventories

Items such as products, materials, and supplies held by a company for the purpose of resale or production.

Variable Costing

An accounting method that includes only variable production costs (materials, labor, and variable overhead) in the cost of goods sold, while fixed overhead costs are expensed in the period incurred.