A cost that is shared by all of the available options or all divisions. Because it is the same for all options, it is not relevant and should not be taken into account in making a decision between any two different options.

A cost that is shared by all of the available options or all divisions. Because it is the same for all options, it is not relevant and should not be taken into account in making a decision between any two different options.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter10: Short-term Decision Making

Section: Chapter Questions

Problem 2MC: Which type of incurred costs are not relevant in decision-making (i.e., they have no bearing on...

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Concept explainers

Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.

Question

A cost that is shared by all of the available options or all divisions. Because it is the same for all options, it is not relevant and should not be taken into account in
making a decision between any two different options.
Select the correct response:
Committed Cost
Fixed Cost
Imputed Cost
Opportunity Cost
Common Cost

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