Which of the following statements is true?
A) Past costs are always relevant for decisions and are often useful in estimating future cost behaviour
B) Past costs are always relevant for decisions, but are rarely useful in estimating future cost behaviour
C) Past costs are never relevant for decisions, but are often useful in estimating future cost behaviour
D) Past costs are never relevant for decisions, nor are they useful in estimating future cost behaviour

Question

Quizplus · Accepted Answer

Past costs, also known as sunk costs, are not relevant for decision-making because they cannot be altered by any decision made now or in the future. However, analyzing past costs can be useful for estimating future cost behavior, helping in budgeting and forecasting.

Which of the Following Statements Is True