What do you mean by Sunk Cost?

The Meaning and Definition of Sunk Cost. (Cost Accounting)

Sunk cost is the past cost which is not recoverable. Its written down value is less than its salvage value. Example of sunk cost may be cost of plant, machinery, furniture etc. which has been completely destroyed.

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These costs are not relevant for the purpose of decision-making and not affected by increase or decrease in volume of out put.

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