Answered step by step
Verified Expert Solution
Question
...
1 Approved Answer
Define relevant cost. Why are historical costs irrelevant? A - Relevant costs are expected future costs. To be considered relevant, costs must occur in the
Define relevant cost. Why are historical costs irrelevant? A - Relevant costs are expected future costs. To be considered relevant, costs must occur in the future and differ among the alternative course of action. Costs that are not revelent are said to be irrelevant. Historical costs are helpful for making informed predictions of expected future cost but are irrelevant because they are past costs and are irrelevant to to decision making. Instructors Q So you're telling me that if I had invested $10million in a project, it's irrelevant regarding whether or not we continue to invest in the project? Criteria If answer is outside of our textbook, please provide your source or reference, if within, provide the page or pages. Reference - Horngren, C. T., Datar, S.M., Foster, G., Rajan, M., & Ittner, C. (2009). Cost Accounting: A Managerial Emphasis (13th ed.). Upper Saddle River, NJ: Pearson Prentice Hall, pp. 388-389
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started