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Relevant Costs in Eliminating a Product or Segment

Instructions:

Choose an answer and hit 'next'. You will receive your score and answers at the end.

question 1 of 3

In business, which of these fixed costs is LEAST likely to change if a production change is made?

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1. When a business considers eliminating a product or segment, what kind of analysis should be done to see if a product should be kept?

2. Which of these is a relevant cost for a product?

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About This Quiz & Worksheet

If you're looking to measure your knowledge of the considerations and forms of relevant costs in eliminating products, this efficient quiz/worksheet can help. You'll be asked a series of multiple-choice questions about costs and discontinuing products.

Quiz & Worksheet Goals

This quiz/worksheet touches on the following aspects of relevant costs in eliminating products:

  • Fixed and relevant costs
  • Determining whether or not a product should be kept
  • When to discontinue a product

Skills Practiced

  • Distinguishing differences - compare and contrast different types of cost
  • Making connections - use understanding of different kinds of analysis to match a situational question with the relevant form of analysis
  • Information recall - access the knowledge you've gained regarding when it's a good idea to discontinue a product

Additional Learning

To learn more about keeping and eliminating products, you can dissect the accompanying lesson on Relevant Costs in Eliminating a Product or Segment. This lesson is composed of the following objectives:

  • Know what relevant costs refer to
  • Explore the application of incremental analysis
  • Understand the significance of how fixed cost is affected
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