Relevant and non relevant costs
[DOC File]AGENDA: RELEVANT COSTS FOR DECISION MAKING
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1. Identification of relevant costs. 2. Drop or retain a segment. 3. Make or buy decision. 4. Utilization of constrained resources. 5. Special order. RELEVANT COSTS. Every decision involves choosing from among at least two alternatives. A relevant cost or benefit …
[DOC File]Revision 2 – Investment Appraisal - Yola
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Non-relevant costs. 3.2.1 Other . non-relevant costs: Committed costs – they are . future cash flow but. will be . incurred anyway, regardless of what decision will be taken. Interest costs – they have already been . included in the discount rate, if counted, it will be . double counted. 4. Allowing for Tax, Inflation and Working Capital. 4 ...
[DOC File]AGENDA: RELEVANT COSTS FOR DECISION MAKING
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Relevant costs and benefits are also known as differential costs and benefits. Avoidable costs are those costs that can be eliminated in whole or in part by choosing one alternative over another. Avoidable costs are relevant costs. Two broad categories of costs are never relevant in decisions: 1. Sunk costs. 2.
[DOC File]CHAPTER 1: INTRODUCTION
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Discretionary fixed costs. b. Non-value-adding costs. c. Avoidable costs. d. Direct costs. d 15. ABC Company breaks even at $600,000 sales and earns $60,000 at $700,000 sales. ... Predicting costs at activity levels that are outside the relevant range is called. a. association. b. correlation. c. extrapolation. d. none of the above. a 37. A non ...
[DOCX File]Audience - Home | Department of Finance
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include other relevant information, such as the parties involved and the costs of the proposed commitment. For example, records of high-risk commitments could include, where appropriate: the key elements of the proposed commitment, such as the item, cost, parties, timeframes and any risks associated with the proposal
[DOC File]RELEVANT COST CASES:
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The annual budgeted costs those are not relevant to the decision. Any non recurring costs that would arise due to the closing of the plant . Looking at the financial data, should the plant be closed? Explain your answer. Identify any revenues or costs not specifically mentioned in the problem that Qual Support should consider before making a ...
[DOCX File]CHAPTER 12
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Relevant costs, regardless of whether they are variable or fixed, are avoidable because one decision alternative was chosen over another. In an outsourcing decision, variable production costs are relevant. Fixed production costs are relevant only if they can be avoided if production is discontinued.
[DOC File]Chapter 10—Relevant Information for Decision-Making
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The relevant cost for Browning to consider in making its decision is. a. $45,000 of original product costs. b. $23,000 for reworking the units. c. $68,000 for reworking the units. d. $28,000 for selling the units to the junk dealer. ANS: B. Only the actual reworking costs are relevant. Original purchase costs are irrelevant. DIF: Easy OBJ: 10-3
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