Opportunity costs represent: Question options: a)Costs avoided by making a particular decision. b)Benefits foregone. c)Costs avoided by making a particular decision. d)Cash expenditures for business opportunities.

Opportunity costs represent: Question options: a)Costs avoided by making a particular decision. b)Benefits foregone. c)Costs avoided by making a particular decision. d)Cash expenditures for business opportunities.

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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Which type of incurred costs are not relevant in decision-making (i.e., they have no bearing on future events) and should be excluded in decision-making? A. avoidable costs B. unavoidable costs C. sunk costs D. differential costs
Opportunity costs represent: a) Costs avoided by making a particular decision. b) Benefits foregone. c) Costs avoided by making a particular decision. d) Cash expenditures for business opportunities.
Harrison Company determines that an opportunity cost of an alternate course of action is relevant to a make-or-buy decision. Which statement is true of the opportunity cost? should be ignored if it does not involve a cash outlay should be added to the "buy" costs should be subtracted from the "make" costs should be added to the "make" costs
Which of the following is NOT one of the definitions of "Cost" concept? Select one: a. Cost means economic sacrifice, measured in terms of standard monetary unit, incurred or potentially to be incurred, as a consequence of a business decision to achieve a specific objective b. Cost is the amount of expenditure (actual or notional) incurred or attributable to a given thing c. Cost refers only to the cash paid for purchasing an item. d. Cost is a measurement, in monetary terms, of the amount of resources used for the purpose of production of goods or rendering services
Which of the following costs are irrelevant to business decisions? a. Avoidable costs b. Costs that differ between alternatives c. Sunk costs d. Variable costs
Match each of the following terms with the best definition. A. Theory of constraints B. Sunk cost C. Differential analysis D. Opportunity cost - Strategy that focuses on reducing bottlenecks. - Revenue forgone from an alternative use of an asset. - Not relevant to future decisions. - Evaluation of how income will change based on an alternative course of action.
Which of the following costs are irrelevant to business decisions? Avoidable costs Costs that differ between alternatives Sunk costs Variable costs
Which statement below best describes a profit center?a. The authority to make decisions affecting the major determinants of profit, including the power to choose its markets and sources of supply.b. The authority to make decisions affecting the major determinants of profit, including the power to choose its markets, sources of supply, and significant control over the amount of invested capital.c. The authority to make decisions over the most significant costs of operations, including the power to choose the sources of supply.d. The authority to provide specialized support to other units within the organization.e. The responsibility for combining the raw materials, direct labor, and other factors of production into a final product.
Match each of the terms below with its definition. 1. Sunk cost a. Additional costs incurred from a course of action 2. Out-of-pocket cost b. Additional revenue from a course of action 3. Opportunity cost c. A future outlay of cash 4. Incremental cost d. Potential benefit lost from taking a course of action 5. Incremental revenue e. A cost that arises from a past decision and cannot be changed
Besides the dollar cost, what other costs should you consider when comparingalternative solutions to a problem or goal?
The trend in financial management is to treat expenditure on human resource as ____ a. as expense b. as liability c. as cost d. an investment
Which statement below best describes an investment center? a. The authority to make decisions affecting the major determinants of profit, including the power to choose its markets and sources of supply. b. The authority to make decisions affecting the major determinants of profit, including the power to choose its markets and sources of supply, and significant control over the amount of invested capital. c. The authority to make decisions over the most significant costs of operations, including the power to choose the sources of supply. d. The authority to provide specialized support to other units within the organization. e. The responsibility for developing markets for and selling of the output of the organization.