Sunk costs are irrelevant to current and future decisions.

True / False 

 

Markup percentage equals total costs divided by desired profit.

True / False 

 

An opportunity cost is the potential benefit lost by taking an action instead of an alternative action.

True/ False

 

A company has the capacity to produce either 10,000 units of Product A or 10,000 units of Product B. Assuming the market demand for both products is unlimited, the company should commit 100% of its capacity to the product that has the higher contribution margin per unit of scarce resource.

True or False

 

A company manufactures birdhouses for a total cost of $100 per unit and plans a 25% markup on total cost. The company’s planned selling price is $125 per unit.

True or False

Answer rating: 100% (QA)

Sunk costs are irrelevant to current and future decisions TRUE These are the costs that have been in... View the full answer