Question: Economic theory states that managers should set price equal to
Economic theory states that managers should set price equal to marginal cost in perfect competition. Accountants use variable cost to approximate marginal costs. Compare and contrast marginal cost and variable cost, and explain whether using variable costs as an approximation for marginal cost is appropriate for making pricing decisions.
Relevant QuestionsAccording to Keith Hallin, program affordability manager (target costing) for Boeing ’s MMA Program in Integrated Defense Systems, reaching target costs is a challenge for the company’s entire value chain. Explain how ...Anzola Company had the following data (in millions) for a recent period. Fill in the blanks. There were no beginning or ending inventories.a. Sales $920b. Direct materials used 350c. Direct labor 210Indirect manufacturing ...The Velasquez Company, a maker of a variety of metal and plastic products, is in the midst of a business downturn and is saddled with many idle facilities. Columbia Health Care has approached Velasquez to produce 300,000 ...The Transnational Trucking Company has the following operating results to date for 20X1:Operating revenues . $50,000,000Operating costs ... 40,000,000Operating income ... $10,000,000A large Boston manufacturer has inquired ...Rouse Manufacturing Limited produces and sells one product, a three-foot Canadian flag. During 20X0, the company manufactured and sold 65,000 flags at $27 each. Existing production capacity is 75,000 flags per year.In ...
Post your question