IIA
IIA-CIA-PART3 · Question #185
IIA-CIA-PART3 Question #185: Real Exam Question with Answer & Explanation
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Question
A large retail customer made an offer to buy 10.000 units at a special price of $7 per unit. The manufacturer usually sells each unit for §10, Variable Manufacturing costs are 55 per unit and fixed manufacturing costs are $3 per unit. For the manufacturer to accept the offer, which of the following assumptions needs to be true?
Options
- AFixed and Variable manufacturing costs are less than the special offer selling price.
- BThe manufacturer can fulfill the order without expanding the capacities of the production facilities.
- CCosts related to accepting this offer can be absorbed through the sale of other products.
- DThe manufacturer's production facilities are currently operating at full capacity.
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