Relevant costs are ________.
A) sunk costs
B) expected future costs
C) actual present costs
D) historical costs

Question

Quizplus · Accepted Answer

Relevant costs are expected future costs that differ among alternatives. Sunk costs (A) are costs that have already been incurred and cannot be recovered, and therefore are not relevant for decision-making. Actual present costs (C) and historical costs (D) may be useful in understanding past performance, but they are not necessarily relevant for decision-making if they do not differ among alternatives.

Relevant Costs Are ________