A relevant cost is a cost that is a(n):Group of answer choicesfuture costnon-cash expensesunk costpast cost
Question
A relevant cost is a cost that is a(n):Group of answer choicesfuture costnon-cash expensesunk costpast cost
Solution
A relevant cost is a future cost.
Here's why:
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Relevant costs are costs that should be considered when making decisions. They are costs that will change depending on the decision you make.
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Future costs are costs that will be incurred in the future as a result of a decision made now. These costs are relevant because they can be changed or avoided depending on the decision you make.
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Non-cash expenses, sunk costs, and past costs are not relevant costs. Non-cash expenses are costs that do not involve cash outflows and cannot be changed or avoided. Sunk costs are costs that have already been incurred and cannot be recovered, so they should not affect future decisions. Past costs are costs that have already been incurred, so they cannot be changed or avoided.
Therefore, a relevant cost is a future cost because it can be changed or avoided depending on the decision
Similar Questions
For make-or-buy decisions, relevant costs include:Group of answer choicesdifferential costs plus fixed costsincremental costs plus differential costsincremental costs plus sunk costsincremental costs plus opportunity costs
When analysing a make-or-buy decision, costs that will be incurred regardless of the decision:Group of answer choicesshould be included in the decision.are unavoidable and therefore should be ignored.are known as relevant costs.are known as incremental costs.
A cost that requires a future outlay of cash and is relevant for decision making, is a(n):Multiple ChoiceOperating cost.Out-of-pocket cost.Uncontrollable cost.Sunk cost.Opportunity cost.
Fill in the Blank QuestionFill in the blank question. costs, also called differential costs, are the additional costs from selecting a certain course of action.
Telephone costs are USUALLY classified as:Group of answer choicesvariable costs.fixed costs.irrelevant costs.mixed costs.
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