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Management · Q367

Management Accounting

Graduate and Post Graduate · Management · question 367

Q367

In cost-plus pricing, 'plus' refers to a component named as

A.
off shore cost
B.
markup
Answer
C.
sunk cost
D.
outsource cost

Answer: Option B

Solution

Answer: Option B
Solution:
In cost-plus pricing, 'plus' refers to a component named as markup. Cost-plus pricing, also called markup pricing, is the practice by a company of determining the cost of the product to the company and then adding a percentage on top of that price to determine the selling price to the customer.