For a cost to be relevant,it must be:
A)a differential cost and a sunk cost.
B)a differential cost,but not a sunk cost.
C)a sunk cost,but not a differential cost.
D)neither a differential cost nor a sunk cost.

Question

Quizplus · Accepted Answer

A relevant cost is a cost that differs between alternatives. This is what a differential cost is. A relevant cost is not a sunk cost because a sunk cost is a cost that has already been incurred and cannot be recovered. Therefore, the best choice is option B.

For a Cost to Be Relevant,it Must Be