Variable cost is a cost which varies with the level of activity and normally incremental cost which is relevant in decision making. However, in some cases, these costs do not change for the change in decision and hence regarded as irrelevant. The situations in which the variable cost shall be regarded as irrelevant cost.

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Chapter 12, Problem 3Q

To determine

Variable cost is a cost which varies with the level of activity and normally incremental cost which is relevant in decision making. However, in some cases, these costs do not change for the change in decision and hence regarded as irrelevant.

The situations in which the variable cost shall be regarded as irrelevant cost.

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