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Chapter+13+Discussion+Questions+-+SV - products 11 Briefly...

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Chapter 13 – Short-Run Decision Making:  Relevant Costing - Discussion  Questions 1. Describe the steps in the decision making model. 2. Define relevant costs. 3. What are you comparing in a make or buy decision? 4. What cost might or might not be relevant in a make or buy decision? 5. What must first be considered when analyzing a special order? 6. When does fixed overhead become relevant in a special order decision? 7. What types of financial statements are useful when evaluating a keep or drop  decision? 8. When a product line is eliminated, why aren’t the total fixed costs associated with  that line  not  automatically eliminated as well? 9. What is the difference between direct and common fixed costs? 10. How might the decision to drop a product line affect a company’s remaining 
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Unformatted text preview: products? 11. Briefly explain what happens to total variable costs when a product line is dropped. 12. What is the split off point when processing joint products? 13. What is the goal when determining the product mix? 14. Describe two types of constraints that should be considered when determining the optimal product mix. 15. What are two methods of calculating price? 16. Suppose that you are the manager of a local deli. Give an example of each of the following decisions that you might have to make and identify three factors that would be relevant to each decision: a. Special order b. Make or Buy c. Eliminating an unprofitable business segment....
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Chapter+13+Discussion+Questions+-+SV - products 11 Briefly...

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