Cost Drivers Scenario [WLOs: 1, 2, 3, 4] [CLOs: 3, 6]
Prior to beginning work on this discussion forum, read Chapters 10, 11, and 13 in your textbook.
Write: Make sure your response addressing the following question is more than 200 words and include an in-text citation from the reading material where appropriate.
A manager in your organization tells you over coffee one morning, “Differential costing is easy; variable costs are the only costs that are relevant.” As the organization’s accountant, how would you respond to this statement?
Later in your conversation this same manager opens a folder and produces a document he just received regarding a special order at a price that he believes is “below cost.” The manager is opposed to accepting orders of this nature because he feels every sale needs to carry a fair share of full costs in order to keep the company from failing. What would be your reply to this manager?