Question

Rent charged by business premises owned by the businessman himself, it is an example of _______.

• A. Conversion costs
• B. Imputed costs
• C. Sunk costs
• D. Relevant costs

Answer 1

Answer: (B)

Imputed costs

An imputed cost is that cost which is not actually incurred. It is an invisible cost that is not incurred directly as opposed to explicit cost.

Rent charged for own premises in the business is one of the example of imputed cost.