Question: True or False questions True False Variable costs may not change under alternative courses of action, while fixed costs may change. True False When deciding
True or False questions
| True | False | Variable costs may not change under alternative courses of action, while fixed costs may change. |
| True | False | When deciding whether to accept an order at a special price, management should make its decision on the basis of the total cost per unit and the expected revenue. |
| True | False | If a company is operating at full capacity, the incremental costs of a special order will likely include fixed manufacturing costs. |
| True | False | An example of an incremental analysis decision is make or buy. |
| True | False | Opportunity cost is the potential benefit that may be obtained by following an alternative course of action. |
| True | False | The basic decision rule in a sell or process further decision is: sell without further processing as long as the incremental revenue from processing exceeds the incremental processing costs. |
| True | False | Sell or process further decisions are particularly applicable to production processes that produce multiple products simultaneously. |
| True | False | An important factor to be considered in a retain or replace equipment decision is the book value of the old equipment. |
| True | False | A trade-in allowance or cash disposal value of an existing asset in a retain or replace equipment decision is irrelevant. |
| True | False | During incremental analysis, qualitative features that are not easily measured should be ignored. |
| True | False | An example of a qualitative factor is the effect on employees and the community when deciding whether to use outsourcing. |
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