Which of the following would be an irrelevant cost?
A) Future costs that differ among alternatives.
B) Benefits foregone by choosing one alternative over another.
C) Costs that have already been incurred.
D) Costs that are avoidable.

Question

Quizplus · Accepted Answer

An irrelevant cost is a cost that will not be affected by the decision to choose one alternative over another. Costs that have already been incurred are sunk costs and cannot be changed by the decision. Hence, they are irrelevant costs. A, B, and D are not irrelevant costs as they are future costs, opportunity costs, and avoidable costs, respectively.

Which of the Following Would Be an Irrelevant Cost