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| Question | Answer |
|---|---|
| Relevant costing | Relevant costs and revenues are those costs and revenues that change as a direct result of a decision taken. |
| Non relevant costing | Costs which are not relevant to a decision are known as non-relevant costs and include: sunk costs, committed costs, non-cash flow costs, general fixed overheads and net book values |
| Opportunity costs | The value of the next best alternative that is forgone when a decision is made |
| Sunk cost | Is expenditure which has already been incurred in the past |
| Abnormal loss | An excess of loss within that month |
| Abnormal gain | Some months may be more than expected |