Which of the Following Is Not Relevant to Management's Decision

question 30

Multiple Choice

Which of the following is not relevant to management's decision regarding refinishing the tables or selling them as is?

• A)The additional $300,000 revenue that can be generated if the tables are refinished.
• B)The $355,000 manufacturing cost of the tables already incurred.
• C)The additional $315,000 cost to refinish the tables.
• D)The effect of selling "seconds" on Fancy's reputation as a fine-furniture manufacturer.

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Definitions:

Risk-free Rates

Risk-free Rates represent the return on investment of an absolutely safe asset, with no risk of financial loss, typically exemplified by treasury bills of a stable government.

Spot Exchange Rate

The existing exchange value for immediate buying or selling of a currency.

Futures Price

The agreed-upon price for the future delivery of a particular commodity, financial instrument, or currency.

Risk-free Rates

Theoretical return rates on an investment assumed to have no risk of financial loss, typically represented by the yield on government securities.