Match each definition that follows with the term (a-e) it defines.
-Evaluation of how income will change based on an alternative course of action
A)Opportunity cost
B)Sunk cost
C)Theory of constraints
D)Differential analysis
E)Product cost distortion

Question

Quizplus · Accepted Answer

Differential analysis is the evaluation of how income will change based on an alternative course of action. The other terms are defined as follows: A) Opportunity cost is the cost of the forgone next best alternative. B) Sunk cost is a cost that has already been incurred and cannot be recovered. C) Theory of constraints is a management philosophy that aims to identify and alleviate constraints that limit a company's ability to achieve its goals. E) Product cost distortion is the result of allocating fixed manufacturing overhead costs unevenly to products.

Match Each Definition That Follows with the Term (A-E) It