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    Relevant Costs for Decision Making

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    I need to identify a decision/plan that has recently been made by Best Buy or will be made in the near future. I also need help in identifying two relevant and two non-relevant costs in this decision.

    If you cannot identify specific actual amounts using the data, then please submit a reasonable estimate and apply the tool as if the data were factual.

    It would be helpful if the report include
    ? The name and nature of the organization (i.e. Best Buy Co., Inc.)
    ? The activity and time period used
    ? The inputs used
    ? Your results
    ? Any implications from your results

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    Solution Preview

    Activity and time period used
    The activity we have decided is of international expansion and to start its operations in India. This growth proves to be a large opportunity for multinationals.
    Time period is within in one year. (Upto the year 2008)

    Relevant costs
    An item is relevant if it is different between or among decision alternatives. That item is not relevant if it is the same between or among decision alternatives.
    Here are some follow-up generalizations. As with all generalizations, there will always be exceptions.
    1. In general, sunk costs are not relevant because they cannot be avoided in a decision. They have already been incurred ...

    Solution Summary

    This explains the Relevant costs