A Cost Should Be Considered Sunk When It

question 64

Multiple Choice

A cost should be considered sunk when it:

• A)Is fully depreciated
• B)Produces no additional sales revenues
• C)Has no effect on future flows
• D)Is replaced by costs that are not yet sunk

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Definitions:

Beginning Inventory

The value of goods available for sale or use at the start of an accounting period.

Ending Inventory

The total value of goods available for sale at the end of an accounting period, calculated by adding purchases to beginning inventory and subtracting the cost of goods sold.

End-of-Month Inventory

The valuation of all unsold goods, raw materials, and work-in-progress held by a company at the end of the month.

Sales Data

Information related to the quantity sold, revenue generated, and patterns of sales within a specific period.