Questions from Managerial Accounting

Q: The decision to accept or reject a special order and the selection

The decision to accept or reject a special order and the selection of a price for a special order are very similar decisions. Explain.

Q: Describe the following approaches to pricing new products: skimming pricing,

Describe the following approaches to pricing new products: skimming pricing, penetration pricing, and target costing.

Q: Explain what is meant by unlawful price discrimination and predatory pricing.

Explain what is meant by unlawful price discrimination and predatory pricing.

Q: Comment on the following remark made by a bank president: “

Comment on the following remark made by a bank president: “The prices of our banking services are determined by the financial-services market. Costs are irrelevant.”

Q: Briefly define total cost and marginal cost.

Briefly define total cost and marginal cost.

Q: Determining the best approach to pricing requires a cost-benefit trade

Determining the best approach to pricing requires a cost-benefit trade-off. Explain.

Q: Explain how to compute the after-tax amount of a cash

Explain how to compute the after-tax amount of a cash revenue or expense.

Q: What is the primary disadvantage of basing the cost plus pricing formula

What is the primary disadvantage of basing the cost plus pricing formula on absorption cost?

Q: Explain the behavioral problem that can result when cost-plus prices

Explain the behavioral problem that can result when cost-plus prices are based on variable cost.

Q: Briefly explain the concept of return-on-investment pricing.

Briefly explain the concept of return-on-investment pricing.