Question

Overview

Respond to the discussion topic below with one or two paragraphs.

Consider incremental analysis as one of several possible approaches to decision making.

Discussion Requirements

Post comments and explain, with examples, how decision making and analysis, with the tools from our course, may be of value to you and your future endeavors.

Include specific examples such as a company seeking to increase profits would.

Answer 1

Incremental analysis is marginal or differential analysis which is used to analyze the financial information needed for decision making, It is tool or process which helps management to take decision. It is useful for business strategy including the decision to continuing process or outsource the process. It identifies the relevant revenues and costs and estimates expected impact on profits. In this system, systematic analysis does and finds outcome, later consider whether such outcome is favorable or not. If it is favorable then only it is acceptable or rejected, In such a way Analysis and decision making are co related in this process. For example, 5 star hotel which has earned huge rental incomes in the current year due to Cultural activities held in his city, If he plans same revenue for next year and prepares for arrangements then he should confirm whether such activities will be happened in his city or not. If yes then only his should go for investments in arrangements or else he may face loss due investment of arrangement if activities are going to happen in other city, So the management can take proper decision through incremental analysis and can save them from losses. So through this we can also understand how it can help us in making profits also. Future profits are depend on decision taken in present with the help of past data. The data only can show about what we have done whether it is right or wrong. Right thing can be done again or repeat and wrong things can be avoided in future.