Decision Making Paper 10

1

Which one of the following statements best describes characteristics of the growth phase of the product life cycle?






2

Which one of the following is not a characteristic of market-based costing?






3

Edward Sporting Ltd. is introducing a new product. Management considers the sales life cycle to strategically determine pricing on this innovative product. They decide to price the new product low to generate excitement. Which one of the following pricing approaches did management implement?






4

Harding, Inc., prices its main product by adding 30% to the manufacturing cost per unit. Harding’s variable manufacturing costs are $12 per unit, variable selling and administrative costs are $1 per unit, and fixed manufacturing costs per quarter total $2,000,000. Anticipated quarterly sales were 50000 units Harding’s market has become more competitive with similar companies offering a selling price of $60 per unit. This has resulted in decreased demand for Harding’s product causing actual quarterly sales to be 40000 units Harding’s selling price per unit for the next quarter should be






5

A corporation produces and sells floor tiles. The corporation has five retail stores, each located in a different city. Each store has a different pricing schedule to maintain the lowest prices in its respective city. This is an example of






6

Which one of the following pricing methods takes into consideration a product’s entire life cycle?






7

Which one of the following statements best represents the order of the steps in developing target prices?






8

A firm in which of the following industries is most likely to use a market-based as opposed to a cost-based approach to pricing decisions?






9

A pharmaceutical company is preparing to release a new medication. The controller would like to consider the product life cycle in pricing, costing, and budgeting decisions for the product. The statement below that best represents the time span that the controller should consider is the time from initial






10

Target cost per unit is the difference between target






Result

Total Questions:
Correct Answers:
Wrong Answers:
Percentage: