AVOIDABLE COST Definition

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AVOIDABLE COST is the amount of expense that would not occur if a particular decision were to be implemented (e.g., if an employee is laid off at a company that is self-insured for unemployment compensation, the avoidable cost is total direct salary less payments for unemployment benefits plus savings in employee benefits).

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DUAL PURPOSE TEST is when audit procedures are classified both as substantive tests and tests of controls. When an audit procedure provides both types of evidence it is a dual purpose test.

ENTERED see JOURNAL ENTRY.

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