Which of the following are not relevant to the decision of whether to drop a business segment or not?
A) Fixed overhead applied to the segment
B) Revenues of the segment
C) Variable costs of goods sold of the segment
D) Variable operating expenses of the segment
E) B and C only

Question

Quizplus · Accepted Answer

Fixed overhead applied to the segment is not relevant to the decision of whether to drop a business segment or not because fixed overheads typically do not change with the level of production or sales and would still be incurred even if the segment is dropped.

Which of the Following Are Not Relevant to the Decision