The additional cost incurred as a result of selecting one decision alternative over another; the same as a relevant or differential cost a cost that can be avoided if a company takes a particular course of action the costs of the common inputs that result in two or more products another term for an incremental or relevant cost costs incurred in the past that are not relevant to present decisions the only kind of cost that managers need to consider when deciding whether to make or buy a product; the same as a differential or incremental cost the point where joint products can be separately identified value of the benefits foregone when one decision alternative is selected over another the cost incurred for the benefit of multiple departments or products the preferred method of allocating common costs to joint product