The difference of cost, which occurs while considering the alternatives can be classified as ___________?
Correct answer: D. differential costHire An Accountant
- A. dependent cost
- B. independent cost
- C. incremental cost
- D. differential costHire An Accountant
Explanation
Differential cost is the difference in cost between two or more alternatives. Incremental cost usually refers specifically to the additional cost caused by an increase in activity, making differential cost the broader term here.
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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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