ABC Engineering just purchased a new machine. All of the following are examples of incremental cash flows except _______________.

Question

Quizplus · Accepted Answer

Developmental costs are not incremental cash flows as they are sunk costs that were already incurred before the decision to purchase the new machine was made. The other options (A, C, and D) are all incremental cash flows that should be taken into consideration when evaluating the financial impact of purchasing the new machine.

ABC Engineering Just Purchased a New Machine