Irrelevant costs in construction - Revision history

Editor at 17:04, 31 December 2020

2020-12-31T17:04:57Z

← Older revision		Revision as of 17:04, 31 December 2020
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	* Notional/non-cash costs: Depreciation, amortisation, and so on.		* Notional/non-cash costs: Depreciation, amortisation, and so on.

−	~~= Find out more =~~	+	= Related articles on Designing Buildings Wiki =
−		+
−	=== Related articles on Designing Buildings Wiki ===	+

	* Accounting.		* Accounting.
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	* Yield.		* Yield.

−	[[Category:Cost_/_business_planning]] [[Category:Procurement]]	+	[[Category:DCN_Definition]] [[Category:Cost_/_business_planning]] [[Category:Procurement]]

Designing Buildings: moved Irrelevant cost to Irrelevant costs in construction

2018-11-28T15:41:47Z

moved Irrelevant cost to Irrelevant costs in construction

← Older revision

Revision as of 15:41, 28 November 2018

Designing Buildings at 07:14, 7 August 2018

2018-08-07T07:14:58Z

← Older revision		Revision as of 07:14, 7 August 2018
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−	~~Irrelevant~~ cost is an accounting term ~~that is~~ used to refer to costs that do not ~~pertain~~ to a particular business decision. ~~This means that those~~ costs will ~~not~~ be ~~affected depending on~~ the decision ~~that is taken and will be incurred regardless~~.	+	An irrelevant cost is an accounting term used to refer to costs that do not relate to whether or not a particular business decision is made. Irrelevant costs will be incurred regardless of the decision.

−	By identifying the irrelevant costs ~~that relate~~ to a particular business decision, ~~any~~ unnecessary cost information can be removed, leaving only costs that are relevant to the decision (i.e. will be affected ~~as a result~~ depending on ~~the alternatives~~). Time and effort can be saved by distinguishing between relevant and irrelevant costs when analysing decision options.	+	By identifying the irrelevant costs in relation to a particular business decision, unnecessary cost information can be removed from the decision making process, leaving only costs that are relevant to the decision (i.e. 'relevant costs' that will be affected depending on which option is selected). Time and effort can be saved by distinguishing between relevant and irrelevant costs when analysing decision options.

	Typically, irrelevant costs include:		Typically, irrelevant costs include:

−	* Sunk costs: ~~These include those costs~~ that have already been incurred, ~~they~~ are independent of any ~~event~~ that ~~may occur~~ in the future.	+	* Sunk costs: Costs that have already been incurred, and so are independent of any decision that might be made in the future.
−	* Committed costs: ~~This is a cost~~ that will be incurred in the future but must be paid regardless of ~~the~~ business ~~decision being made~~.	+	* Committed costs: Costs that will be incurred in the future but must be paid regardless of any business decisions.
−	* Notional/non-cash costs: ~~These include depreciation~~, amortisation, and so on.	+	* Notional/non-cash costs: Depreciation, amortisation, and so on.

	= Find out more =		= Find out more =

Editor: Created page with "Irrelevant cost is an accounting term that is used to refer to costs that do not pertain to a particular business decision. This means that those costs will not be affected depen..."

2018-08-06T16:16:38Z

Created page with "Irrelevant cost is an accounting term that is used to refer to costs that do not pertain to a particular business decision. This means that those costs will not be affected depen..."

New page

Irrelevant cost is an accounting term that is used to refer to costs that do not pertain to a particular business decision. This means that those costs will not be affected depending on the decision that is taken and will be incurred regardless.

By identifying the irrelevant costs that relate to a particular business decision, any unnecessary cost information can be removed, leaving only costs that are relevant to the decision (i.e. will be affected as a result depending on the alternatives). Time and effort can be saved by distinguishing between relevant and irrelevant costs when analysing decision options.

Typically, irrelevant costs include:

* Sunk costs: These include those costs that have already been incurred, they are independent of any event that may occur in the future.
* Committed costs: This is a cost that will be incurred in the future but must be paid regardless of the business decision being made.
* Notional/non-cash costs: These include depreciation, amortisation, and so on.

= Find out more =

=== Related articles on Designing Buildings Wiki ===

* Accounting.
* Business plan.
* Cash flow.
* Cost control.
* Cost engineering.
* Cost plans.
* Elemental cost plan.
* Estimate.
* Front-loaded costs.
* Hard costs v soft costs.
* Initial cost appraisal.
* Margin.
* Relevant costs.
* Turnover.
* Yield.

[[Category:Cost_/_business_planning]] [[Category:Procurement]]