Question

The reasons for using the variable-cost approach include all of the following except this approach provides the most defensible bases for justifying prices to all interested parties. avoids arbitrary allocation of common fixed costs to individual product lines. provides the type of data managers need for pricing special orders. is more consistent with cost-volume-profit analysis.

Answer 1

Answer:

The reasons for using the variable-cost approach include all of the following except

this approach provides the most defensible bases for justifying prices to all interested parties.

Explanation:

This is not part of the reasons for using the variable-cost approach.  But options b, c, and d are certainly the reasons why the variable-cost approach is used.  The variable-cost approach provides a differential analysis for decision-making.  It assigns overhead costs to the period in which they are incurred, while other variable costs are assigned to the merchandise produced within that period.  Thus, by excluding fixed manufacturing overhead cost, only the direct costs associated with production are used in accounting for the product's costs.