i) Incremental Cost
Incremental cost is an additional cost that will occur if a particular decision is taken. Provided this additional cost will result in a cash flow, it is a relevant cost.
ii) Differential Cost
It is the amount by which future costs will be different depending on which cause of action is taken. It is thus an amount by which future cost will be higher or lower, if a particular course of action is chosen. It is a relevant cost if it involves additional cash flow.
iii) Committed Cost
It is a category of unavoidable costs. It is thus a cost that a company has already committed to or an obligation already made, that it cannot avoid by any means.
iv) Sunk Cost
A sunk cost is a cost that has already been committed by an earlier decision. They are not relevant cost in decision making.
v) Opportunity Cost
An opportunity cost is a benefit that will be lost by taking one course of action instead of the next most profitable course of action. It is not an actual cost in 77 the real sense of an amount paid out as an expense. It is a comparative cost resulting from making once choice over another