You have just completed a $20,000 feasibility study for a new coffee shop in some retail space you own. You bought the space two years ago for $100,000, but if you sold it today, you would net $115,000 after taxes. Outfitting the space for a coffee shop would require a capital expenditure of $30,000 plus an initial investment of $5,000 in inventory. What is the initial incremental cash flow for opening the coffee shop today? Answer a negative number if the cash flow is a cost.

Which of the following is considered as a sunk cost? (Given answer not: A)

A.The $20,000 feasibility study.

B.The purchasing price of $100,000 for the retail space.

C.The after-tax sale profit of $115,000 from the retail space.

D.Both (A) and (B).