In relevant cost analysis, managers should avoid incorrect general assumptions and beware of misleading unit cost information.

Question

Quizplus · Accepted Answer

In relevant cost analysis, managers need to consider only those costs and revenues that are relevant to a specific decision. If incorrect general assumptions or misleading unit cost information is used, it may lead to incorrect decision-making. Therefore, managers should avoid such errors and carefully analyze only the relevant information.

In Relevant Cost Analysis, Managers Should Avoid Incorrect General Assumptions