Why should managers care about the overcost or undercost of a product? A. Averaging can result in inaccurate and misleading cost data. Thus, companies may overinvest in overvalued products and underinvest in undervalued products. B. The overcharge may cause competitors to enter a market and take market share for products that a firm mistakenly views as low-margin or even unprofitable. Undercosting can cause companies to sell products that they are actually losing money on, when they mistakenly think they are profitable. C. The overcost of products can lead to sales that actually result in losses, because the sales can generate less revenue than the cost of the resources they use. The undercosting of products may result in a loss of market share to competitors selling similar products. D. If commodity prices are determined by the market on the basis of co
Answer 1
The overcharge can cause competitors to enter a market and gain market share for products that a company mistakenly views as low-margin or even unprofitable. Undercosting can cause companies to sell products that they are actually losing money on, when they mistakenly think they are profitable. Explanation: the manager would be concerned about the super cost or understanding of the product, because the super cost would be when competitors enter the market and they take market share so that the company can trust that they have less margin while on the other hand under cost means that the company selling the product at the same time loses money when they believe to be profitable
answer 2
OK, but every time you don’t pay, the price of the fine may increase.
answer 3
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