The cost of new machine is considered as ______________?
Correct answer: A. relevant
- A. relevant
- B. bunk
- C. dispose value
- D. sunk
Explanation
The cost of a machine that will be acquired in the future is a relevant cost because it changes depending on the decision being considered. A sunk cost would already have been incurred and could not be changed.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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