The major weakness of average-cost pricing is that it

A. always results in a profit that is less than expected.
B. ignores likely customer demand at different prices.
C. usually leads to losses instead of profits.
D. is too hard for most managers to use.
E. All of these are major weaknesses of average-cost pricing.


Answer: B

Business

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In B2B, customers are often companies.

Answer the following statement true (T) or false (F)

Business

While formally the SEC is charged with the responsibility for establishing accounting principles to be followed in the preparation of SEC filings, the impact of the SEC generally has been

A) in its assistance to Congress with the development of tax law. B) in guiding the development of stock exchanges. C) ineffective in controlling foreign corporations and investors. D) in its informal review and approval of standards developed in the private sector prior to their release.

Business

Pecan Inc. produces water valves. Overhead costs have been identified as follows:  Activity PoolCostActivity DriverActivityQuality control$55,500Number of inspections185Material maintenance$87,400Number of machine hours19,000Setups$75,000Number of production runs60 Pecan makes 3 models of valves with the following details:  ?EconomyStandardPremiumUnits produced20,00040,0007,000Number of inspections540140Machine hours4,50012,0002,500Production runs52035Required:  a. Calculate the activity rate for each activity. b. Determine the amount of indirect costs assigned to each of the products.

What will be an ideal response?

Business

If a company has $50,000 of assets, which of the following could be true?

A. It has ?$50,000 in stockholders' equity and $100,000 in liabilities. B. The company has fewer assets than it does liabilities. C. It has $30,000 in liabilities and $80,000 in owners' equity. D. The company has more owners' equity than assets. E. It has $23,000 in owners' equity and $27,000 in liabilities.

Business