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Which of the following is false? 1.Incremental analysis identifies the probable effects of management decisions on...

Which of the following is false?

1.Incremental analysis identifies the probable effects of management decisions on future earnings.

2.In incremental analysis, total fixed costs will always remain constant under alternative courses of action.

3.The process used to identify the financial data that change under alternative courses of action is called incremental analysis.

4.Incremental costs are always relevant.

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Answer #1

Ans : B. In Incremental Analysis, total fixed costs will always remains constant under alternative course of action.

There may be a change in fixed cost, if there is traceable fixed cost it may change.

Rest all are correct.

Incremental costs are relevant

Pt.c is definition of Incremental Analysis.

And Incremental Analysis is done so that it is easier in taking future decisions.

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