Answer

Answer

by Tanea Taher -
Number of replies: 0

 

(1) Answer: Sunk cost has no resale value that's why it's not considered as relevant cost.

               

(2) Answer: Opportunity cost means when one alternative is chosen and reject other alternatives and the cost of next best alternative is called Opportunity cost. So, in decision making when a person reject an alternative also reject the profit or income of this alternative, so he lost an alternative. So, this Opportunity also carry a cost for taking first alternative. 

                

(3) Answer: Direct Material, Direct Labour, variable manufacturing overhead, fixed manufacturing overhead traceable and those has resale value theses are relevant cost in times of buy or make decision. 

                

(4) Answer: Traceable fixed cost has resale value and in particular it's traceable also this cost is actually happened for a particular product that's why this cost is considered as relevant cost.