_____ Is Defined as a Cost-Oriented Pricing Approach That Involves

question 20

Multiple Choice

_____ is defined as a cost-oriented pricing approach that involves totaling up the costs of producing a product or completing a project and then adding on a percentage or fixed profit amount.

• A)Cost-plus pricing
• B)Rate-of-return pricing
• C)Prestige pricing
• D)Predatory pricing

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Definitions:

Work in Process

A term referring to items and materials that are being transformed into finished products but are not yet complete.

Variable Overhead

Variable overhead costs are those expenses that fluctuate with production volume, such as utilities or materials.

Fixed Overhead

Regular, unchanged costs associated with operating a business that do not fluctuate with production levels.

Direct Labor Rate Variances

This term refers to the difference between the actual cost of direct labor and the expected (or standard) cost, used in manufacturing and budgeting.