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Seneca College - HRM 732 Quiz 6 1)Which of the following statements is (are) true concerning common costs? Fixed costs are always sunk costs

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Seneca College - HRM 732

Quiz 6

1)Which of the following statements is (are) true concerning common costs?

2. Fixed costs are always sunk costs.
3. In a make-or-buy decision, the original purchase price of equipment that is currently used in the manufacturing process is usually a relevant cost because the equipment can be sold for its salvage value.
4. A product line should be dropped when:
5. In a make-or-buy decision, direct materials and direct labor are usually incremental costs.
6. Sunk costs are incremental costs because they increase or decrease with the choice of one alternative over another.
7. The qualitative aspects of a decision must receive the same careful attention as the quantitative aspects.
8. Which of the following is never considered in incremental analysis?
9. Which of the following is most likely relevant in a make-or-buy decision?
10. A company is trying to decide whether to sell partially completed goods in their current state or incur additional costs to finish the goods and sell them as complete units. Which of the following is not relevant to the decision?