Asked by Maddi Coones on Jun 03, 2024
Verified
Incremental analysis would be appropriate for
A) acceptance of an order at a special price.
B) a retain or replace equipment decision.
C) a sell or process further decision.
D) all of these answer choices are correct.
Incremental Analysis
A decision-making process used to evaluate the financial impacts of different choices, focusing on the costs and benefits that change between alternatives.
Special Price
A discounted or promotional pricing strategy applied to a product or service for a limited time or specific customers.
- Acknowledge the essence of piecewise analysis and its criticality in leadership choices.
- Absorb the criteria necessary for conducting special order evaluations, with a focus on capacity implications and incremental cost analysis.
- Understand the application of incremental analysis across various managerial decisions, such as special orders, equipment replacement, and further processing decisions.
Verified Answer
ZK
Zybrea KnightJun 04, 2024
Final Answer :
D
Explanation :
Incremental analysis (also known as differential analysis) is a decision-making technique that involves examining only the relevant costs and benefits that differ between two possible alternatives. All of the choices provided (acceptance of an order at a special price, retain or replace equipment decision, and a sell or process further decision) involve comparing two alternatives and therefore require incremental analysis.
Learning Objectives
- Acknowledge the essence of piecewise analysis and its criticality in leadership choices.
- Absorb the criteria necessary for conducting special order evaluations, with a focus on capacity implications and incremental cost analysis.
- Understand the application of incremental analysis across various managerial decisions, such as special orders, equipment replacement, and further processing decisions.