An additional cost incurred, only if a company pursues a particular course of action, is a(n):
A) Incremental cost.
B) Period cost.
C) Discount cost.
D) Pocket cost.
E) Sunk cost.

Question

Quizplus · Accepted Answer

An incremental cost is a cost that is incurred only if a particular course of action is taken. It is the additional cost involved in producing or selling one additional unit of output or extending a particular service or product line. Therefore, it is the most appropriate option among the given choices. Period cost represents the cost that is not directly related to the production process or the cost of goods sold. Discount cost refers to a cost incurred to realize a reduced price on an item or service. Pocket cost and sunk cost do not apply to this scenario.

An Additional Cost Incurred, Only If a Company Pursues a Particular