If the Incremental Cost Approach Rather Than the Total Cost

question 47

Multiple Choice

If the incremental cost approach rather than the total cost approach is used to evaluate alternatives,which statement below is true?

• A) The net book value of the present machine will become relevant to the analysis.
• B) The College will reject both these alternatives as they both have negative net present values.
• C) If the College chooses between these alternatives,the purchase of the new system will be selected.
• D) The incremental cost approach would facilitate an easy comparison of these two alternatives with any others the College might decide to consider.

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Definitions:

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I-SBAR-R

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