Please indicate which of the following are relevant costs for decision making. Also indicate if the cost is a sunk cost, opportunity cost, or an out of pocket cost, and your reasoning. a. The annual cost of Rent for your factory-You are debating discontinuing the product you manufacture. You are in the middle of a 10 year lease, and there is no option to terminate the lease early. b. The cost of the specialized Machines in your factory, You are debating whether to discontinue production of the product involved and buy the product from a supplier instead. c. The salvage value of the specialized Machinery in your factory from b. above. The salvage value is equal to 20% of the original cost of the Machinery and will be realized if production is discontinued. d. The cost of a new oil burner about to be installed to replace a destroyed one. e. The cost of an old inefficient oil burner that will be replaced by a more modern and efficient one. f. Depreciation expense on the old oil burner in e. above. g. The manufacturing co
Please indicate which of the following are relevant costs for decision making. Also indicate if the cost is a sunk cost, opportunity cost, or an out of pocket cost, and your reasoning.
a. The annual cost of Rent for your factory-You are debating discontinuing the product you manufacture. You are in the middle of a 10 year lease, and there is no option to terminate the lease early.
b. The cost of the specialized Machines in your factory, You are debating whether to discontinue production of the product involved and buy the product from a supplier instead.
c. The salvage value of the specialized Machinery in your factory from b. above. The salvage value is equal to 20% of the original cost of the Machinery and will be realized if production is discontinued.
d. The cost of a new oil burner about to be installed to replace a destroyed one.
e. The cost of an old inefficient oil burner that will be replaced by a more modern and efficient one.
f.
g. The
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