Every month, Clara’s Coffee incurs total costs of $50,000 to brew several thousand gallons of coffee. The firm can then spend $28,000 to bottle the coffee as is, or it can spend $45,000 to sweeten the coffee and then bottle it. Clara has just learned that the total costs of brewing will rise to $60,000 in the month ahead. Given this information, which of the following statements is accurate? 

A : This change in brewing costs is a relevant cost that must be included in an incremental analysis. 

B : We cannot determine what effect this change in brewing costs will have on the firm’s net income for either type of coffee. 

C : This change in brewing costs is a sunk cost that is relevant to an incremental analysis. 

D : This change in brewing costs is irrelevant to an incremental analysis since it is a joint cost.

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choice D This change in brewing costs is irrelevant to ... View the full answer