(8 x 1 mark=8 Section A Short Answer Questions (1 mark each) marks) 1. Define the following terms: differential cost, sunk cost and opportunity cost. 2. What is the difference between absorption costing and variable costing? 3. What are the two stages of allocation in activity-based costing? 4. Why is the sales forecast the starting point in budgeting? 5. What is meant by the term variance? 6. What is a flexible budget and how does it differ from a static budget? 7. What is meant by the terms margin and turnover in ROI calculations? 8. What is relevant cost and how does it differ from irrelevant costs?