Which of the following is false?
A)Incremental analysis identifies the probable effects of management decisions on future earnings.
B)In incremental analysis, total fixed costs will always remain constant under alternative courses of action.
C)The process used to identify the financial data that change under alternative courses of action is called incremental analysis.
D)Incremental costs are always relevant.

Question

Quizplus · Accepted Answer

In incremental analysis, total fixed costs may change under alternative courses of action. Incremental analysis focuses on identifying the relevant costs and revenues that will change if a particular decision is made. This includes both variable and fixed costs that will be affected by the decision. Therefore, it is possible that total fixed costs may change under alternative courses of action.

Which of the Following Is False