20% off ACCA & CIMA Books

OpenTuition recommends the new interactive BPP books for March 2026 exams.
Get your discount code >>

Relevant cost question

This topic has 1 reply, 2 voices, and was last updated 11 years ago by John Moffat.

Viewing 2 posts - 1 through 2 (of 2 total)

Author
Posts
October 16, 2014 at 5:29 am #204550
mansoor
Participant
- Topics: 423
- Replies: 541
Salary to be paid to a market researcher who will oversee the development of a new product. this is a new post to be created especially for the new product but the 12,000 salary will be fixed cost. is this cost relevant to the decision to proceed with the development of the product.
the text answer is RELEVANT
I answered IRRELEVANT, arguing that this was a committed cost.
what is wrong with my argument?
thanks
October 16, 2014 at 3:36 pm #204601
John Moffat
Keymaster
- Topics: 57
- Replies: 54820
Since this is a new post to be created especially for the new product, it is a cost that will only occur if we do go ahead with the new product.
It is not committed – it is ‘to be created’. If we do not do the new product then we will not create it.
Author
Posts

Viewing 2 posts - 1 through 2 (of 2 total)

You must be logged in to reply to this topic.