A Sunk Cost Is a Cash Outlay That Has Already

question 96

True/False

A sunk cost is a cash outlay that has already been made and therefore has no effect on the cash flows relevant to a current decision.

---

Definitions:

Employees

Individuals who are hired by a company to perform specific duties and tasks in exchange for compensation, contributing to the company's operations and goals.

Common Stockholders

Individuals or entities that own shares in a company's common stock, granting them voting rights and a share in the company's profits through dividends.

Minimum Amount

The smallest quantity or value permitted or possible in a given set of circumstances.

Dividends

Payments made by a corporation to its shareholder members, distributing a portion of the company’s earnings.