In the decision process, management should ignore:

Question

Quizplus · Accepted Answer

Sunk costs are costs that have already been incurred and cannot be recovered. Therefore, they should not be considered in the decision-making process. Ignoring sunk costs allows management to focus on the relevant costs and benefits of a decision, which are the future costs and benefits that will result from taking a particular action. Implicit costs, historical costs, and incremental costs are all relevant costs that should be considered in the decision-making process.

In the Decision Process, Management Should Ignore