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When Mutual exclusive decision is to be made or projects to be selected, the benefit which is left due to selection of one project instead of other project is the 'Opportunity Cost' for selecting one project over other.
Example:
Project 1 benefit = 100000
Project 2 benefit = 200000
Opportunity cost for project 1 = 200000
Opportunity cost for project 2 = 100000
What else can I help you with?
What is cost driver and cost pool?
Cost driver is the basic activity which increases the or utilize the cost while cost pool is that in which all costs are jointly shown for example machine setup cost is cost driver while over all overheads is cost pool.
Is transportation cost an ordering cost?
yes transportation an ordering cost
How do you calculate cost of deposit of banks?
cost of deposits= Interest paid on Deposits/Total deposits
What are the total costs to make a quantity of 15000 units per year with a fixed cost of 100000 per year and a variable costs of 4.00 per unit?
Total Cost = Variable Cost + Fixed CostVariable Cost = 4 per UnitTotal Units to produce = 15000Variable Cost = 15000 * 4 = 60000Total Cost = 60000 + 100000Total Cost = 160000
How does the cost of debt differ from the cost of capital?
Cost of debt considers only the cost that goes to the debtholders. Cost of capital considers debt and equity costs both.
What is an increase in opportunity cost?
an increase in oppourtunity cost is rasing of chicken and rice.
What is an oppourtunity cost to a government offering a tax break to businesses that invest in new machinery?
a decrease in the amount of money collected
How do you analyze a project as oppourtunity cost?
Opportunity cost - This refers to selecting a project over another due to the scarcity of resources. In other words, by spending this rupee on this project, you are passing on the opportunity to spend this rupee on another project. How big an opportunity are you missing? The smaller the opportunity cost, the better it is.Opportunity Cost is a technique that is used in project selection
A noun meaning possibility?
chance, danger, feasibillity, likelihood, odds, oppourtunity, plausibility, probability
How do you spell oppourtunity?
The correct spelling is opportunity.
What is the effect of capital adequacy ratio in profit and loss account?
Well there is an inverse re lation ship between profitabliltiy and CAR.Higher CAR reflects higher amount of money remains idle.so,it lost its oppourtunity interest income.as a result it will defineltly affects in profitability.however there are some exceptional cases.thats because of not funding income comes from non funding activities.
Is total cost different from overhead cost?
Overhead cost is part of total cost and not different from total cost as formula is as follows: Total cost = material cost + labor cost + overhead cost
Is fire a selling cost manufacturing cost direct manufacturing cost indirect administraitve cost fixed cost or variable cost?
Is fire a selling cost, direct manufacturing cost, indirect manufacturing cost, administrative cost, foxed cost or variable cost.
What are the types of cost center?
Production cost centerpersonal cost centerservice cost centeroperation cost centerimpersonal cost centerprocess cost center
Does total cost equal the fixed cost plus the vriable cost divides by volume?
Formula for Total Cost: Fixed Cost + Variable Cost + Semi-Variable Cost if there is no semi-variable cost then fixed cost + variable cost is a total cost. if we devide the total cost with volume as well then it will be cost per unit not total cost
Is janitorial cost a variable cost?
No, Janitorial Cost is not a variable cost, it is a Fixed Cost.
What is the selling price of a jacket that is 156 the profit is 30 percent of the cost what is the price?
Selling price = Cost + Profit= Cost + Cost*30% = cost*(1.30) = 156*1.3 = 202.80Selling price = Cost + Profit= Cost + Cost*30% = cost*(1.30) = 156*1.3 = 202.80Selling price = Cost + Profit= Cost + Cost*30% = cost*(1.30) = 156*1.3 = 202.80Selling price = Cost + Profit= Cost + Cost*30% = cost*(1.30) = 156*1.3 = 202.80
