Which of the following statements regarding decision making \"rules of thumb\" i

Question

Which of the following statements regarding decision making "rules of thumb" is correct? 0 A. O B. O C. O D. O E. Information considered relevant to a decision is information that differs between alternatives and pertains to the future. A traditional income statement approach should be used in decision making. Qualitative considerations are ignored when evaluating decision alternatives. Per unit variable costs can be misleading because such amounts appear to behave as fixed costs. Variable costs should only be considered in total.

Explanation / Answer

Option A is the correct answer

Because the information which is used in decision making shall be relevant. The relevant information can only give the correct result. We shall distinguish between the relevant and irrelevant information when going through decision making process. Whether it is variable cost or fixed cost, no bother about that, we shall see whether it is relevant or irrelevant.

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