You Have Invested About $100,000 in a New (Hopefully)trendy Restaurant

question 21

Multiple Choice

You have invested about $100,000 in a new (hopefully) trendy restaurant in an urban location. These costs have gone to purchase the restaurant, prepay insurance for the following year, and purchase supplies for the restaurant. It will cost you an additional $10,000 per year to hire each waiter and waitress. (They earn tips which they get to keep.) Which of the following statements is most accurate?

• A)The $100,000 sum represents sunk costs, whereas the costs for waiters and waitresses is not sunk, but all of these costs would be considered accounting costs, but do not include all of the possible economic costs of operating the business.
• B)The $100,000 sum represents sunk costs, whereas the costs for waiters and waitresses is not sunk, but all of these costs would be considered accounting costs, and also include all of the possible economic costs of operating the business
• C)The $100,000 sum represents sunk costs and the costs for waiters and waitresses are sunk as well.
• D)The $100,000 sum represents sunk costs and all of the possible accounting costs as well.

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Definitions:

Personal Morals

An individual's set of beliefs about what is right and wrong, formed by personal values, cultural influences, and societal norms.

Organizational Members

Individuals who participate in an organization's structure, contributing to its culture and goals through various roles and responsibilities.

Corporate Policies

The rules, guidelines, and procedures established by a company to govern its operations and ensure compliance with legal and ethical standards.

Ethical Culture

The shared values, beliefs, and practices within an organization that influence ethical behavior among its members.