ACCT 434 Week 5 Pricing Decisions .pdf
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ACCT 434 Week 5 Pricing Decisions
Management Control Systems
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1. Question : (TCO 7) Major influences of competitors, costs, and customers on pricing
decisions are factors of
2. Question : (TCO 7) The first step in implementing target pricing and target costing is
3. Question : (TCO 7) The markup percentage is usually higher if the cost base used is
4. Question : (TCO 7) An understanding of life-cycle costs can lead to
5. Question : (TCO 7) Pritchard Company manufactures a product that has a variable cost
of $30 per unit. Fixed costs total $1,500,000, allocated on the basis of the number of units
produced. Selling price is computed by adding a 20% markup to full cost. How much
should the selling price be per unit for 300,000 units?
6. Question : (TCO 8) A product may be passed from one subunit to another subunit in the
same organization. The product is known as
7. Question : (TCO 8) Transfer prices should be judged by whether they promote
8. Question : (TCO 8) When an industry has excess capacity, market prices may drop well
below their historical average. If this drop is temporary, it is called
9. Question : (TCO 8) An advantage of using budgeted costs for transfer pricing among
divisions is that
10. Question : (TCO 8) The seller of Product A has no idle capacity and can sell all it can
produce at $20 per unit. Outlay cost is $4. What is the opportunity cost, assuming the seller
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