Which of the Following Statements Is TRUE Concerning Product Costing

Multiple Choice

Which of the following statements is TRUE concerning product costing systems?

A) Companies that undercost products always sell products at a loss.
B) Companies that overcost run the risk of losing customers.
C) Undercosting or overcosting does not relate to product cost cross-subsidization.
D) Peanut butter costing is another term for direct costing.
E) Companies that overcost will make more profit by passing along higher prices to customers.