109.award:1.00 pointIf by dropping a product a firm can avoid more in fixed costs than it loses in contribution margin, then the firm is better off economically if the product is dropped.→ Show Get answer to your question and much more 110.award:1.00 pointThe cost of resources that has no alternative use in a make or buy decision has an opportunity cost of zero.→ Get answer to your question and much more 111.award:1.00 pointManagers should pay little attention to bottleneck operations because they have limited capacity for producing output.True→False 112.award:1.00 pointOpportunity costs are recorded in the accounts of an organization. Get answer to your question and much more 113.award:1.00 pointAll other things equal, it is profitable to continue processing a joint product after the split-off point so long as the incremental revenue from further processing exceeds theincremental costs of further processing.→ Get answer to your question and much more 114.award:1.00 pointJoint production costs are relevant costs in decisions about what to do with a product from the split-off point onward in the production process. Get answer to your question and much more 115.award:1.00 pointTwo or more different products that are manufactured in the same production period are known as joint products.True→False 116.award:1.00 point(Appendix 12A) The absorption costing approach to cost-plus pricing will result in attaining the company's required rate of return only if forecasted unit sales are realized,holding all other things constant.→ Get answer to your question and much more Product X-547 is one of the joint products in a joint manufacturing process. Management is considering whether to sell X-547 at the split-off point or to process X-547 further into Xylene. The following data have been gathered: I. Selling price of X-547 Which of the above items are relevant in a decision of whether to sell the X-547 as is or process it further into Xylene? Students also viewedRecommended textbook solutions
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Are future costs that differ across alternatives?Relevant costs are those expected future costs that differ among alternative courses of action – that is the cost is pertinent to the decision being made. This idea of relevance focuses on two factors: the cost must be a future cost (not sunk) and the cost must differ among alternative courses of action.
Which cost is not relevant for decision making?Irrelevant costs are those that will not change in the future when you make one decision versus another. Examples of irrelevant costs are sunk costs, committed costs, or overheads as these cannot be avoided.
Why is future cost relevant in decision making?It allows you to determine whether one decision is better than another, based on their different relevant costs and potential outcomes. Relevant costs are critical to making the right choices because financial planning involves identifying future cash flows linked to a particular decision.
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Future costs that do differ among the alternatives are not relevant in a decision.
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