Which of the Following Statements Is False

question 55

Multiple Choice

Which of the following statements is false?

• A) The simplest method used to calculate depreciation is the straight-line method.
• B) A sunk cost is any unrecoverable cost for which the firm is already liable.
• C) Unlevered Net Income = EBIT × τ_c.
• D) The decision to continue or abandon a project should be based only on the incremental costs and benefits of the project going forward.

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Definitions:

First Year

Refers to the initial period or the first 12 months of a specific timeframe, often used in the context of financial or operational performance.

Absorption Costing

A method of product costing that includes all manufacturing costs, both fixed and variable, in the cost of a product.

Contribution Margin

The amount remaining after variable costs have been subtracted from revenue, which contributes to covering fixed costs and generating profit.

South Business Segment

A term possibly referring to a division or part of a company that operates in the southern region, focusing on geographical business segmentation.