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This posting addresses special order decisions.

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Which of the statements below is false regarding special order decisions?

1. A fixed cost element of an identical amount that is common among all alternatives is essentially irrelevant.

2. Fixed cost per unit is equal to total fixed costs divided by a selected volume level.

3. The contribution approach offers more detailed information than does the absorption approach.

4. Fixed cost per unit is a necessary piece of information in the decision making process

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The solution provides the correct answer for which statement is false regarding special order decisions. References are also provided.

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1. A fixed cost element of an identical amount that is common among all alternatives is essentially ...

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