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1.      Opportunity costs need to be considered when deciding on the use of limited      resources.

2.      Opportunity cost depends on alternatives available at a point in time.

3.      Opportunity costs and outlay costs are widely used synonyms.


4.     Opportunity costs apply to resources that will be owned.
     
5.     There is no longer an opportunity cost after a homeowner pays off the mortgage.
     


6.      Outsourcing is a make-or-buy decision for services.

7.     Qualitative factors do not affect a make-or-buy decision.

8.     In a make-or-buy decision, if facilities are and will remain idle when the decision is made to not make a part internally, then the opportunity cost is zero.
     

9.     The key reasons that companies outsource are to improve the company’s focus and reduce operating costs.
     
10.     The big stumbling block to outsourcing has been the cost.
     
11.     To make outsourcing services a good option, the services must be reliable, available when needed, and flexible to adapt to changing conditions.
     


12.      Separable costs are part of a joint process and cannot be exclusively identified with individual products.

13.      The split off point is the juncture in manufacturing where the joint products
     become individually identifiable.

14.      The relevant information for a sell or process further decision includes the costs incurred before the split-off point.

15.     It is profitable to extend processing or to incur additional distribution      costs on a joint product if the additional revenue exceeds joint cost.


16.     Examples of joint products include chemicals, lumber, and flour.
     
17.     The allocation of joint costs should affect the decision to sell or process further.
     


18.     Past costs can be good predictors of future costs.
     
19.     The cost of inventory is relevant when deciding whether to dispose of the inventory in cases of obsolescence.
     

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