When Target Costing and Target Pricing Are Used Together ________

question 70

Multiple Choice

When target costing and target pricing are used together ________.

• A) the target cost is established first, then the target price
• B) the target cost is the estimated long-run cost that enables a product or service to achieve a desired profit
• C) the focus of target pricing is to undercut the competition
• D) target costs are generally higher than current costs

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Definitions:

Risk of Loss

The responsibility for damage or financial burden that may arise from the destruction, damage, or loss of goods.

Fraud in the Inducement

A legal term referring to a deceptive act used to convince someone to enter into a contract, which significantly impacts the victim's decision to agree.

False Representation

The act of providing untrue, misleading, or deceptive information with the intent to defraud others.

Material Fact

A fact that is significant or essential to the issue or matter at hand, which could influence a decision.