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Title: What is a sunk cost? Should it be included in the incremental cash flows for a project? Why or why ... Post by: johnpaech on Nov 19, 2017 What is a sunk cost? Should it be included in the incremental cash flows for a project? Why or why not?
Title: Re: What is a sunk cost? Should it be included in the incremental cash flows for a project? Why or ... Post by: deusmaroto on Nov 19, 2017 A sunk cost is any unrecoverable cost for which the firm is already liable. Sunk costs will have to be paid regardless of the decision whether or not to proceed with the project. Therefore, sunk costs are not incremental with respect to the current decision regarding the project and should not be included in its analysis.
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