For Purposes of Decision Making,avoidable Costs Are Costs That

question 105

Multiple Choice

For purposes of decision making,avoidable costs are costs that:

• A) were incurred in the past.
• B) will not be incurred in the future,regardless of the alternative chosen.
• C) differ between alternatives.
• D) None of the above.

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Definitions:

CVP Analysis

Cost-Volume-Profit Analysis, a managerial accounting technique used to analyze how changes in cost and volume affect a company's operating income and net income.

Manufacturing Costs

The total expense incurred in the process of making a product, including raw materials, labor, and overhead costs.

Mixed Cost

A cost that contains both variable and fixed cost elements, meaning part of the cost varies with the level of output while part remains fixed.

Fixed Cost

Costs that do not change with the level of production or sales, such as rent, salaries, and insurance premiums.