Which of the Following Statements Is FALSE

question 48

Multiple Choice

Which of the following statements is FALSE?

• A)We begin the capital budgeting process by determining the incremental earnings of a project.
• B)The marginal corporate tax rate is the tax rate the firm will pay on an incremental dollar of pre-tax income.
• C)Investments in plant,property,and equipment are directly listed as expense when calculating earnings.
• D)The opportunity cost of using a resource is the value it could have provided in its best alternative use.

---

Definitions:

Direct Labor

Direct labor involves the work of employees that can be directly attributed to the production of specific goods or services.

Direct Materials

The raw materials that are traceable directly to the production of a specific good or product, forming an integral part of the finished product.

Conversion Costs

The combined costs of direct labor and manufacturing overheads incurred to convert raw materials into finished goods.

Direct Materials

Primary elements that are directly involved in the production process of particular products or services.