Financial data are developed for a course of action under an incremental basis and then it is compared to data developed under a differential basis before a decision is made.

Incremental and differential analysis are essentially the same concept in financial decision-making, both involving the comparison of revenues and costs that change under different alternatives. There is no step where data developed under an incremental basis is compared to data developed under a differential basis as they refer to the same process of analyzing the additional or incremental costs and benefits of one option over another.