The Concept and the Different Types of Relevant Cost

Discussion
Name
Institution
Course
Date
DISCUSSION
Relevant cost is an accounting term that is used to describe all the avoidable costs that are normally incurred when making a particular business decision. The concept of relevant cost is used in removing unimportant data that can cause complications in the decision-making process. When making business decisions, accountants need to make a decision based on the relevant information. In business, relevant information can include revenues and future costs that vary in many ways. An example of a relevant cost is ascertaining whether is it advisable to sell a business unit or keep it (Franklin, 2019). Additionally, the opposite of relevant cost us suck cost. A suck cost is normally incurred regardless of the impact of the business decision.
Some of the different types of relevant cost decisions include making versus buying, closing business v...