Friday, November 21, 2008

Recording Opportunity Cost

An Opportunity cost is a potential benefit that is given up when a company chooses one alternative over another. These costs are not usually entered into the accounting records of an organization, but are considered in financing decisions.

Revenue not earned and cannibalized revenue are examples of accounting opportunity costs

No comments:

Popular Accounting Problems

The information on this site is for informational purposes only and should not be used as a substitute for the professional advice of an accountant, tax advisor, attorney, or other professional.