Answered: Incremental costs are the ________…

Incremental costs are the ________ generated by a proposed alternative. A) additional revenues B) additional revenues or reduced costs C) reduced costs D) additional costs or reduced revenues

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter6: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 5DQ

See similar textbooks

Related questions

Q: The increase/decrease in variable cost from existing level to the new level is called as __cost. a.…

A: Variable cost tends to increase or decrease with increased or decreased volume of production whereas…

Q: what are the meaning of Revenue Enhancement and Cost Saving ? and I need examples for each.

A: Revenue enhancement is the enhancement or increase in the revenue, which also leads to an increase…

Q: relevant costs are always: a.variable costs b.avoidable costs c.sunk costs d.fixed costs

A: Relevant costs are the cost that describes the avoidable costs that are incurred for making specific…

Q: An opportunity cost may be described as: a. a foregone benefit. b. a historical cost. c. a…

A: Opportunity cost means the sacrifice of an individual when he chooses one option over another.

Q: Listed below are a number of statements concerning relevant versus irrelevant costs and benefits.…

A: Relevant cost: In managerial accounting, relevant cost refers to cost that is related to specific…

Q: If a firm has already paid an expense or is obligated to pay one in the future, regardless of…

A: In this question, we are required to determine the cost which has already been paid or will be paid…

Q: Accepting a special order will improve overall net operating income if the revenue from the special…

A: Variable costs are the costs which change with change in output. Sunk costs are the costs which are…

Q: Describe the following terms: (a) residual value, (b) guaranteed residual value, and (c) initial…

A: (a) Residual value: It is the projected ending value of an asset after its useful life or lease…

Q: relevant cost analysis is: A. variable costs are always relevant. B. fixed costs are always…

A: When doing cost analysis for the company productions ,company is going to invest a lot of money so…

Q: Future costs that differ across alternatives are: a. Opportunity costsb. Sunk costsc. Relevant…

A: Costs are the amount of expenditures that are made in the business for the purpose of production or…

Q: In making a short-term special decision, which of the following is MOST important? a. Use a…

A: Solution Concept The decision that is to be taken differs from one another on the basis of the time…

Q: A cost that has previously been incurred and can not be recovered by choosing one alternative over…

A: Allocated cost: Expenses assigned to a particular department or project.Fixed cost: Expenses that…

Q: Match each of the terms below with its definition. 1. Sunk cost a. Additional costs incurred from a…

A: Costs: It may be classifed as sunk costs, opportunity costs etc. some kinds of costs are relevant…

Q: When the total fixed costs decrease, the contribution margin per unit ________. A. increases…

A: Contribution margin per unit = Selling price per unit - Variable cost per unit Total fixed cost…

Q: When contribution is positive but equal to fixed cost: a. There is loss less than fixed cost b.…

A: Contribution is the amount received after the variable cost or direct costs are deducted from Sales,…

Q: In incremental analysis, only relevant costs are considered when making a decision among…

A: These are the cost that are specific, pertinent and relevant to a particular decision making of…

Q: Explain how increased revenue that requires more value.

A: As a part of business every business required the company Revenue to be increased comparitively to…

Q: When the level of activity increases, total fixed costs a. decrease. b. remain the same. c.…

A: Costing: Costing is a technique used in cost accounting to determine the cost of a product. With…

Q: If fixed costs increase, what would be the impact on the (a) contribution margin?

A: Fixed cost means the cost which do not vary with the level of output where as variable cost will…

Q: The potential benefit of one alternative that is lost by choosing another is known as a. An…

Q: What concept relates to the proportionate savings in costs gained when levels of production are…

A: Lets understand the meaning of all the terms given in the question. Accounting profit is a terms…

Q: A cost that cannot be changed because it arises from a past decision and is irrelevant to future…

A: Definition:

Q: Accepting a special order will improve overall net operating income if the revenue from the special…

A: Variable costs are the costs which change with change in output. Sunk costs are the costs which are…

Q: The following statements are correct excerpt? OA. Only avoidable costs are relevant for decision…

A: Relevant costs are costs which are important for decision making or these costs can effect the…

Q: The formula for Contribution is Select one: a. Fixed cost + loss b. Sales - Variable cost c. Fixed…

A: Cost accounting system is a framework that guides the firm to calculate their cost and helps in…

Q: What is the term used to describe costs that increase in steps? A. Variable costs B. Fixed costs…

A: Cost is referred as the essential part of the business or a company which looks after the costs such…

Question

Incremental costs are the ________ generated by a proposed alternative.

A) additional revenues

B) additional revenues or reduced costs

C) reduced costs

D) additional costs or reduced revenues

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

A cost that has previously been incurred and can not be recovered by choosing one alternative over another is a(n): allocated cost fixed cost opportunity cost sunk cost avoidable cost
The increase/decrease in variable cost from existing level to the new level is called as __cost. a.Standard b.Marginal c.Fixed d.Opportunity
Accepting a special order will improve overall net operating income if the revenue from the special order exceeds: the contribution margin on the order. the incremental costs associated with the order. the variable costs associated with the order. O the sunk costs associated with the order.
In incremental analysis, only relevant costs are considered when making a decision among alternatives. Explain what relevant costs are. Would these include only variable costs? Explain.
Listed below are a number of statements concerning relevant versus irrelevant costs and benefits. Complete each statement by providing the missing term or phrase. (Terms may be used more than once as an answer.) 1. _____ are costs that have already been incurred and are not relevant to future decisions 2.______ is a measure of the limit placed on a specific resource 3. A/an ________ is the foregone benefit of choosing to do one thing instead of another 4. Monthly Utility costs are estimated to be 1,200 regardless of the course action; in this case the utility costs are considered as a/an__________ 5. When a company has not yet reached the limit on its resources it has _________ 6. A/an _________ has the potential to influence a particular decision and will change depending on the alternative a manager selects. 7. at __________ opportunity costs become relevant and sould be incorporated into the analysis. 8. When managers are forced to choose one alternative over another due to…
Future costs that differ across alternatives are: a. Opportunity costsb. Sunk costsc. Relevant costsd. Variable costs
What concept relates to the proportionate savings in costs gained when levels of production are increased: A) Accounting profit. B) Economies of scale. C) Marginal costs. D) Barriers to entry. E) Economic profit. The benefit lost when choosing one option precludes receiving the benefits from an alternative option was referred to as: A) Irrelevant costs. B) Lost costs. C) Alternative costs. D) Opportunity costs. E) Sunk costs.
If fixed costs increase, what would be the impact on the (a) contribution margin?
Accepting a special order will improve overall net operating income if the revenue from the special order exceeds: Multiple Choice the contribution margin on the order. the incremental costs associated with the order. the variable costs associated with the order. the sunk costs associated with the order.
In making a short-term special decision, which of the following is MOST important? a. Use a conventional absorption costing method b. Focus on the total cost c. Separate variable and fixed costs d. Discount cash flow to their present values
what are the meaning of Revenue Enhancement and Cost Saving ? and I need examples for each.
The following statements are correct excerpt? O A. Only avoidable costs are relevant for decision making B. Incremental cost may include both variable and fixed costs OC. All irrelevant costs are sunk costs OD. All direct or indirect cost depends on the cost object