Which of the following statements is true?
A)All variable costs are relevant costs.
B)Only those variable costs that differ between alternatives are relevant costs.
C)Fixed costs are never relevant costs.
D)All fixed costs are relevant costs as they impact on overall unit costs.

Question

Quizplus · Accepted Answer

Only those variable costs that differ between alternatives are relevant costs because they are the costs that change as a result of choosing one alternative over another. Fixed costs are not relevant as they do not change with different alternatives.

Which of the Following Statements Is True