Fixed costs that may be avoided in the future are
A) unavoidable costs.
B) sunk costs.
C) relevant costs.
D) replacement costs.

Question

Quizplus · Accepted Answer

Relevant costs are costs that are related to a specific decision or situation and will impact the future. Fixed costs that may be avoided in the future are considered relevant costs because they will change if a different decision is made, and they will impact future costs and profits. Avoidable fixed costs are not sunk costs because they can be avoided with a change in the business plan or strategy.

Fixed Costs That May Be Avoided in the Future Are