Difference of cost, which occurs while considering alternatives can be classified as
A. dependent cost
B. independent cost
C. incremental cost
D. differential cost
Answer: Option D
Solution (By Examveda Team)
Difference of cost, which occurs while considering alternatives can be classified as differential cost. Differential cost is the difference between the cost of two alternative decisions, or of a change in output levels. The concept is used when there are multiple possible options to pursue, and a choice must be made to select one option and drop the others.This Question Belongs to Management >> Management Accounting
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