Costs associated with two alternatives, code-named Q and R, being considered by Albiston Corporation are listed below: Required:
a.Which costs are relevant and which are not relevant in the choice between these two alternatives?
b.What is the differential cost between the two alternatives?

Relevant Costs

Costs that are directly influenced by a specific business decision, and are crucial for cost-effective management decisions.

Differential Cost

A future cost that differs between any two alternatives.

Alternatives

Alternatives refer to the different options or choices available in decision-making processes.