Which of the Following Statements Is FALSE

question 67

Multiple Choice

Which of the following statements is FALSE?

• A)Because value is lost when a resource is used by another project,we should include the opportunity cost as an incremental cost of the project.
• B)Sunk costs are incremental with respect to the current decision regarding the project and should be included in its analysis.
• C)Overhead expenses are associated with activities that are not directly attributable to a single business activity but instead affect many different areas of the corporation.
• D)When computing the incremental earnings of an investment decision,we should include all changes between the firm's earnings with the project versus without the project.

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Definitions:

Receivables

Money owed to a company by its customers for goods or services that have been delivered or used but not yet paid for.

Sales

The total amount of goods or services sold by a business within a certain period.

Total Assets Turnover Ratio

A financial metric that measures a company's effectiveness in using its assets to generate sales, calculated as sales divided by total assets.

Assets

Resources owned by a company that have economic value and can be converted into cash.