Methods for a Company to Meet Target Total Cost and the Profit

question 49

Multiple Choice

Methods for a company to meet target total cost and the profit goals if the current cost of the product is higher than the target cost include which of the following?

• A)Accept a lower profit
• B)Cut fixed costs, cut variable costs
• C)Cut fixed costs
• D)Any of the above

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Definitions:

Time And Material Pricing

A pricing method where a project is billed based on the actual time spent and the materials used.

Body Shop

Typically refers to a repair shop specializing in the repair and finishing of automobile bodies.

Cost-Plus Pricing

A pricing strategy where the selling price is determined by adding a specific markup to a product's total cost.

Full Cost

The total cost of production that includes direct and indirect costs, such as raw materials, labor, and overhead expenses.