Question

Which of the following statements is (are) false? (1). In general, the term expense is used for managerial purposes, while the term cost refers to external financial reports. (2). An opportunity cost is the benefit forgone by selecting one alternative over another.

Answer 1

Answer:

Here only the first statement is false and second statement is true.

Explanation:

Statement 1 is false because expenses are the cost that a company incurred while running their business, from the day to day activities , production of goods and services and the cost incurred while distributing the products to consumers, so basically it includes all the cost which a company incurred for generating revenue. It can be said that all the expenses are cost but not ll cost are expense , an example can be cost incurred while acquiring an income generated assets. Not all cost refers to external financial reports.

The second statement is true as opportunity cost can be defined as sacrifices foregone from the alternative use of resources.