Opportunity costs are not recorded in financial accounting systems because historical record keeping is limited to transactions involving alternatives that managers actually selected rather than alternatives that they rejected.

Question

Quizplus · Accepted Answer

Opportunity costs, being the value of the best alternative foregone, are not recorded in financial accounting systems as they do not involve any actual financial transactions. Financial accounting records only actual transactions and events, not hypothetical or potential ones.

Opportunity Costs Are Not Recorded in Financial Accounting Systems Because