When Performing Incremental Analysis

question 5

Multiple Choice

When performing incremental analysis,

• A)process costing unit costs should always be considered as they are incremental costs.
• B)process costing unit costs should be considered as they are period costs.
• C)process costing unit costs should not be considered as they comprise of both product costs and period costs.
• D)all process costing unit costs should not be considered as they are sunk costs.

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Definitions:

Environmental Scanning

The process of gathering, analyzing, and interpreting information about external influences that could impact an organization's decision-making process.

Potential Trends

Emerging patterns or changes in industries, technology, consumer behavior, or the global economy that could influence future developments.

Regulatory Force

External forces, often in the form of government laws, regulations, and policies, that can impact a business’s operations and its approach to the market.

Environmental Scanning

The process by which businesses monitor and analyze their external environment to identify opportunities and threats.