What Cost Concept Used in Applying the Cost-Plus Approach to Product

question 126

Multiple Choice

What cost concept used in applying the cost-plus approach to product pricing includes only total manufacturing costs in the cost amount to which the markup is added?

• A) variable cost concept
• B) total cost concept
• C) product cost concept
• D) opportunity cost concept

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Definitions:

Market Securities

Financial instruments that are traded in financial markets, such as stocks, bonds, and derivatives, representing investment vehicles for owners.

Financing Activities

Transactions that result in changes in the size and composition of the equity and borrowed funds of a business.

Net Cash Provided

The total amount of cash generated by a company's activities, including operating, investing, and financing activities, during a specific period.

Cash Dividends

The distribution of profits by a corporation to its shareholders in the form of cash.