In Which of These Short-Term Decision Areas Are Fixed Costs

question 1

Multiple Choice

In which of these short-term decision areas are fixed costs generally irrelevant?

• A)Make or buy decisions.
• B)Closing a department.
• C)Accepting or rejecting a special order.
• D)All of the above.

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Definitions:

Long-term Note

A debt security that requires repayment of the principal, along with interest, over a period longer than one year, typically used for significant capital expenditures or investments.

Discount On Notes Payable

The difference between the face value of a note and what is actually paid, which occurs when the note is issued for less than its nominal value.

Unearned Revenue

Funds a company acquires for products or services that are still to be provided or executed.

Ordinary Gains

Profits resulting from the sale of assets used in a business's normal operations, subject to regular income tax rates.