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What are ‘hidden’ and ‘unanticipated’ costs associated with introducing own sales force in this case that...

What are ‘hidden’ and ‘unanticipated’ costs associated with introducing own sales force in this case that Macy and Jake have to carefully consider in the analysis? How would inclusion of these costs affect your decision

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Answer #1

Hidden costs are those costs which are not shown on the income statement of the company and those costs are not measured through any financial statement.

Unanticipated cost are those cost which are not forecasted in advance and they occur accidentally and those causes the problem for the management to record them.

Hidden cost for introducing on sales force would be various kinds of control related loss which are not affected into its books of accounts.

Various type of anticipated cost would be those cost who occour accidentally like accidental loss which are not to be recorded in the books of accounts proactively.

Inclusion of these cost will severely affect the decision because it will act negative for the project as it will take down the net present value of those project which where earlier higher and it would lead to even rejection of the projects.

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