A Major Advantage of the Target Costing Approach to Pricing

question 106

Multiple Choice

A major advantage of the target costing approach to pricing is that target costing

• A)allows a company to analyze the potential profit of a product before spending money to produce the product.
• B)is not dependent on customers' quality-versus-price decisions.
• C)identifies unproductive assets.
• D)anticipates the product's profitability midway through its life cycle.

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Definitions:

Intent

The intended purpose or goal of an action, especially in a contract.

Affirmation

A positive statement or declaration, often used in the context of legal oaths.

In Pari Delicto

In equal fault.

Illegal Agreement

A contract or agreement that is not enforceable by law because it involves activities that are against the law or public policy.