After your initial meeting with the management team members and assessing their experience with managerial accounting, you have decided to provide some starting information on the various costs utilized in managerial accounting. Your purpose for providing this information is to give the necessary context to the new management team to enable them to fully understand the accounting information and recommendations you will provide in your final report. Be sure to address the following:

• Explain sunk, opportunity, and accounting costs, and provide three examples of each.
• Explain how each cost relates to developing managerial accounting information required for decision-making.
• Summarize why a manager should understand these concepts, providing an example to support your rationale.
• Explain the differences between fixed and variable costs and provide three examples of each type of cost.
• Summarize the importance for managers to classify these costs correctly, including how the correct classification can inform decision making.