Costs associated with two alternatives, code-named Q and R, being considered by Corniel Corporation are listed below:
Required: a. Which costs are relevant and which are not relevant in the choice between these two alternatives?
Supplies costs :Relevant/Not relevant
Power costs :Not relevant/Relevant
Inspection costs: Relevant/ Not relevant
Assembly costs :Not relevant /Relevant
b. What is the differential cost of Alternative R over Alternative Q? (Negative amount should be indicated by a minus sign. Omit the “$” signs in your response.) Differential cost ?
a. Which costs are relevant and which are not relevant in the choice between these two alternatives
| Particular | Relevant/ Not relevant |
Reasond |
| Supplies costs | Relevant | It is variable in nature and costs differ between alternatives |
| Power costs | Not relevant | Not relevant since the costsdo not differ |
| Inspection costs | Relevant | It is variable in nature and costs differ between alternatives |
| Assembly costs | Relevant | It is variable in nature and costs differ between alternatives |
