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In talking with both customers and other business owners, Mr. Suncat has been wondering about several different business opportunities and has asked you for
In talking with both customers and other business owners, Mr. Suncat has been wondering about several different business opportunities and has asked you for your recommendation on each of them. First, though, Mr. Suncat asks you to define the following cost terms. Define: 1. Avoidable Cost: 2. Unavoidable Cost: 3. Relevant Cost: 4. Irrelevant Cost: 5. Sunk Cost: 6. Opportunity Cost: Next, Mr. Suncat asks you to classify the following costs as a relevant cost or an irrelevant cost and then identify the type of cost (sunk, fixed, variable, or opportunity) assuming that he is considering the possibility of opening a second bakery. Cost Mortgage on the Cake Shop Wages for the Bakers Mr. Suncat's culinary school tuition (paid off in 2018) Icing for the wedding cakes Striping the parking lot in front of the Cake Shop last year Mr. Suncat's decision not to attend graduate school Relevant Sunk, Fixed, Variable, or Irrelevant? or Opportunity?
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