In a One-Time Special Order Situation, If the Price Offered

question 130

True/False

In a one-time special order situation, if the price offered by the buyer is less than the absorption cost per unit, the special order may still be profitable since absorption costs include allocated fixed manufacturing overhead.

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Definitions:

Journalizing

The process of recording transactions in a journal so that their effects are reflected in the accounting records.

Transaction Data

Information collected about each specific activity that takes place within a business, which can be used for various financial and management analysis purposes.

Journal

A daily record of financial transactions, providing a detailed account of all entries for each transaction.

Chart of Accounts

An organized list of all ledger account titles and numbers used by a company, serving as a framework for the recording of financial transactions.