Which type of incurred costs are not relevant in decision-making (i.e., they have no bearing on future events) and should be excluded in decision-making?A. avoidable costsB. unavoidable costsC. sunk costsD. differential costs

Which type of incurred costs are not relevant in decision-making (i.e., they have no bearing on future events) and should be excluded in decision-making?A. avoidable costsB. unavoidable costsC. sunk costsD. differential costs

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: On July 1, Campus Stores Inc. is considering leasing a building and purchasing the necessary…

A: Different costs and advantages that might result from various alternatives available are analyzed in…

Q: Define opportunity costs and explain why they represent acommon source of error in making cost…

Q: Is

Q: Relevant examples of direct and indirect costs

A: Relevant examples of direct and indirect costs.

Q: decision making purposes, relevant costs are: a. variable past costs b. all fixed and variable…

A: Relevant cost is the cost which are relevant in decision making process. Sunk cost are the cost…

Q: Sunk costs should always be included when considering the cost of an activity. True or false, and…

A: Sunk cost are those cost which are already incurred by the business , But business cannot recovered…

Q: Is corrective action always necessary when actual costs are higher than standard costs

A: A company which manufactures products and goods keeps a sharp eye on its costs. When the actual cost…

Q: Ibra Company is considering the following alternatives: Alternative A Alternative B Revenues OMR…

A: We know that, Incremental profit = incremental sales - incremental total cost Total cost = total…

Q: Any cost that is avoidable is relevant for decision purposes. O A. True O B. False

A: Relevant costs are those costs that are affected by the specific management decision being…

Q: What is meant by relevant costs and there use in making short-term decisions?

A: Cost refers to the amount of expenditure incurred by an individual or an entity in relation to goods…

Q: Explain the difference between direct costs and indirect cost

A: Direct cost is the cost incurred by the organization while performing their center business process…

Q: 4. Please state the differences between relevant, opportunity and sunk costs.

A: Cost: The amount paid to purchase the asset, install it, and put it into operations, is referred to…

Q: In cost accounting, differentiate between allowable, allocable, reasonable, and consistent costs.

A: Allowable: A cost is allowable to a project if it meets the following criterias- The costs are…

Q: Which of the following statements about a sunk cost is false? Question 11Answer a. It is relevant to…

A: In cost accounting, several type of cost classifications are there. These are like direct costs,…

Q: ke-or-Buy Decision, Alternatives, Relevant Costs ach year, Basu Company produces 24,000 units of a…

A: Solution Dear student as per the Q&A guideline we are required to answer the first three…

Q: The total cost of a cost object can only include the direct costs that are directly traced to that…

A: The total cost of a cost object includes both costs i.e costs that are directly traced and…

Q: Label each of the following statements as either true (“T”) or false (“F”). Relevant costs are also…

A: Relevant costs: These costs can be defined as the costs that can be avoided if we choose over option…

Q: ________ are the costs associated with not choosing the other alternative.A. Sunk costsB.…

A: The term "cost" alludes to the overall expense incurred in the production of goods and services as…

Q: iable costs in the context of cost-volume-profit (CPV) analysis? b. Fixed costs in the context of…

A: Cost volume profit analysis is very important for the companies because it tells them that whether…

Q: Opportunity costs; a. Are treated as period costs under variable costing b. Have already been…

A: Introduction:- Opportunity cost means as follows under:-

Q: Which of the following costs is relevant in decisionmaking? committed costs accounting costs cash…

A: Following is the answer to the given question

Q: Why is it necessary to distinguish between variable and fixed costs when dealing with mixed costs

A: Introduction:- Every Business expenses are classified as either fixed or variable costs. on other…

Q: Select all of the following that are the same as a relevant cost: unavoidable cost Oavoidable cost…

A: Relevant cost is a cost that is specifically relevant to a particular decision being made. It is a…

Q: What is the relevant range? How does fixed costs and variable costs behave outside the relevant…

A: Relevant range refers to the level of the activity which represents the maximum and minimum limits…

Q: n a decision analysis situation, which one of the following costs is generally not relevant to the…

A: Decision making is the process used to choose one of the various available alternatives. Examples of…

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: Why are the terms direct costs and indirect costs independent of the terms fixed costs and variable…

A: The terms "direct costs" and "indirect costs" are independent of the terms "fixed costs" and…

Q: The costs most relevant to be used in decision making are: a. sunk costs O b. current costs O c.…

A: Cost: It implies to the expense that is incurred on the manufacturing of a product or rendering…

Q: Direct costs can be referred to as fixed costs. True or False?

A: Cost are divided into two parts which are, (1) Direct cost (2) Indirect cost Direct costs are the…

Q: In order to analyze the c-v-p relationship , what types of costs should be classified ? Why?

A: C-V-P relationship means the cost volume and profit relationship. This is usually done to recognize…

Q: What is the benefit of identifying avoidable and unavoidable cost in decision making process?

A: Avoidable costs: Avoidable Costs, as the name suggests, are the costs that can be avoided of the…

Q: What circumstances might create distortions where estimated costs are not an accurate representation…

A: The estimated costs are the costs determined through the estimation process on past…

Q: What are: Relevant / irrelevant / Differential Costs Relevant / irrelevant / Differential Revenues…

A: Relevant / Irrelevant / Differential Costs: Relevant Costs are the cost which are relevant in…

Q: One cost that is irrelevant in decision making is a sunk cost Group of answer choices True False

A: Sunk costs are those costs that are already incurred and it is irrelevant for the decision-making as…

Q: When making decisions, managers should consider a. revenues that differ between alternatives. b.…

A: The explanation for the given options: a. A manager on the verge of making decisions must consider…

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: avoidable and unavoidable cost?

A: Costs are the amount incurred for the different purposes of the business. It is defined in monetary…

Question

Which type of incurred costs are not relevant in decision-making (i.e., they have no bearing on future events) and should be excluded in decision-making?
A. avoidable costs
B. unavoidable costs
C. sunk costs
D. differential costs

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

Similar questions

The term that refers to costs incurred in the past that are not relevant to a decision is: Multiple Choice indirect cost. sunk cost. period cost. marginal cost.
Give two examples of sunk costs, and explain why they are irrelevant in decision making.
Future costs that do not differ among the alternatives are not relevant in a decision. True or False True False
Differential costs are synonymous with: Select one: a. variable costs b. relevant costs c. irrelevant costs d. sunk costs
Direct costs are classified by controllability. True False Can be true, can be false
Problem 4 a. What is the difference between relevant, opportunity and sunk costs? b. Why are fixed costs not included in special order decisions? C. What are the steps involved in decision making?
A cost that has been incurred in the past, cannot be recouped, and is not relevant to future decisions is termed a a. period cost b. replacement cost c. sunk cost d. differential cost
1. What factors determine the relevance of information to decision making? 2. What are sunk costs, and why are they not relevant in making decisions? 3. What information is relevant in an outsourcing decision?
A cost that cannot be changed because it arises from a past decision and is irrelevant to future decisions is a. An uncontrollable cost. d. An opportunity cost. b. An out-of-pocket cost. e. An incremental cost. c. A sunk cost.
hould the costs be historical (embedded)costs or new (marginal) costs?
Why are indirect costs not directly traced to cost objects in the same way as direct costs?