Relevant costs for decision-making are those costs that:

Question

Quizplus · Accepted Answer

Relevant costs are costs that differ among alternative courses of action. These costs are important for decision-making because they help managers to choose the alternative that maximizes profits or minimizes costs. Fixed costs, by definition, do not vary among alternatives and are therefore not relevant for decision-making. Additionally, costs that are the same for all alternatives are not relevant because they do not affect the decision-making process.

Relevant Costs for Decision-Making Are Those Costs That