"The cost of sugarcane is an avoidable cost." Justify for or against and give a reason.

FOR — The statement is correct. The cost of sugarcane IS an avoidable cost.

Reason:

Avoidable costs are those costs which can be eliminated by ceasing or reducing a particular activity. Sugarcane is the direct (variable) raw material used in the production of sugar. If a sugar mill decides not to produce sugar (or produces less sugar), the corresponding cost of sugarcane is automatically avoided/reduced because no sugarcane needs to be purchased for the production not undertaken.

In contrast, fixed costs like the rent of the factory, depreciation of plant or salaries of permanent staff would still have to be incurred even if production is stopped — these are unavoidable costs in the short run.