When analyzing the incremental costs used to help make a short-term operating decision:
A)fixed costs are irrelevant
B)variable costs are irrelevant
C)both fixed costs and variable costs are relevant
D)incremental revenues are irrelevant

Question

Quizplus · Accepted Answer

Fixed costs are irrelevant in the short-term operating decision-making process because they do not change with the level of output or activity. Therefore, they do not affect the incremental costs associated with a particular decision.

When Analyzing the Incremental Costs Used to Help Make a Short-Term