Only 25

A cost that cannot be avoided or hanged because it arises from a past decision, and is irrelevant to c future decisions, is called a(n) Sunk cost. Incremental cost. Opportunity cost. Out-of-pocket cost. An opportunity cost: Is an unavoidable cost. Requires a current outlay of cash. Results from past managerial decisions. Is the lost benefit of choosing an alternative course of action. A cost that requires a current and/or future outlay of cash, and is usually an incremental cost, is a(n): Sunk cost. Out-of-pocket cost. Opportunity cost. Operating cost A company has the choice selling 1,000 defective units as scrap or rebuilding them. The company could sell the defective units as they are for $4.00 per unit. Alternatively, it could rebuild them with incremental costs of $1.00 per unit for materials, $2.00 per unit for labor, and $1.50 per unit for overhead, and then sell the rebuilt units for $8.00 each. What should the company do? Sell the units as scrap. Rebuild the units. It does not matter because both alternatives have the same result. Neither sell nor rebuild because both alternatives produce a loss. Instead, the company should store the units permanently. Which of the following should be classified as production costs? Direct labor and administrative costs. Direct materials, direct labor, and manufacturing overhead. Manufacturing overhead and selling and administrative costs. Direct materials, direct labor, and selling and administrative costs