Question

When using differential analysis to analyze two alternatives to the current operation, what factors should not be considered?

Answer 1

Answer:

C). Overhead costs that are the same for both alternatives.

Explanation:

Differential analysis is elucidated as the evaluation of the various costs as well as benefits that arouses out of the various possible solutions associated to a specific problem. Thus, it basically aims to analyze the different factors in alternative solutions and making the best decision(out of alternatives) keeping the future goals in mind.

As per the question, the factor that need not be considered while employing differential analysis would be 'overhead costs that are the same for both alternatives' as it focuses on assessing the unique factors(revenues, expenses, etc.) to bring solution to a problem differently out of all the probable alternatives. Thus, option C is the correct answer.