🎴 Flashcard Mode
Management Accounting
Card1 / 25
Mastered0
Review0
QuestionClick to flip
Business firms will never price the sales at or below the marginal cost.
AnswerClick to flip back
A
False
💡 Explanation:
Explanation: The very purpose of marginal costing is to assess the risk taking capacity of a business firm. When the supply is in excess of the demand, or when a new product is launched, or when the installed capacity is not fully utilized, management of business firms would do well to sell below the total cost provided the selling price is at or below the marginal cost