AB Mining Company just commissioned a firm to identify if an unused portion of their mine contains any silver or gold at a cost of $125,000. This is an example of a(n)

Question

Quizplus · Accepted Answer

The $125,000 spent on the firm to identify if there is any silver or gold in the unused portion of the mine is a sunk cost because it is a cost that has already been incurred and cannot be recovered, regardless of future outcomes.

AB Mining Company Just Commissioned a Firm to Identify If