When Evaluating Alternatives,what Type of Costs Should Be Considered

question 129

Multiple Choice

When evaluating alternatives,what type of costs should be considered?

• A) Relevant costs
• B) Sunk costs
• C) Prevention costs
• D) Fixed costs

---

Definitions:

Machine-Hours

A measurement of the amount of time machines are operated in the production process, used as an allocation base for applying manufacturing overhead.

Direct Labor-Hours

A measure of the total hours worked directly on a specific product or service by employees.

Predetermined Overhead Rate

An estimated rate used to apply manufacturing overhead to products or job orders, calculated before the period begins based on expected costs and activity levels.

Machine-Hours

A measurement of the amount of time machines are operated during the production process.