An uncontrollable cost _____.
A)should be ignored in evaluating the responsibility center manager's performance
B)is influenced by a manager's decisions and actions
C)tells a great deal about a manager's decision-making abilities
D)is the same as a sunk cost

Question

Quizplus · Accepted Answer

An uncontrollable cost is one that cannot be influenced by a manager's decisions or actions within a given time frame. Therefore, it should not be used to evaluate a manager's performance, as they have no control over these costs. Choices B and C are incorrect because they describe controllable costs, and D is incorrect because sunk costs are past costs that cannot be recovered, which is a different concept.

An Uncontrollable Cost _____