Step 1: Classify each transformation as linear or non-linear from its mathematical form.
A function of $r$ is linear only if it can be written as $s=a\,r+b$ for constants $a,b$.
Step 2: Apply this test to the negative transformation.
$s=(L-1)-r=(-1)r+(L-1)$ fits the form $a\,r+b$ exactly with $a=-1$, $b=L-1$, so it is linear. Calling it non-linear, as option (A) does, is a false statement, and since the question asks for the INCORRECT option, (A) is the answer.
Step 3: Confirm thresholding is a valid, correct statement.
Thresholding is a piecewise-constant step function of $r$ whose defined purpose (producing a two-level binary image) exactly matches option (B), so (B) is true.
Step 4: Confirm log and power-law statements are both correct using their derivatives.
For the log transform, $\dfrac{ds}{dr}=\dfrac{c}{1+r}$ is large for small $r$ (dark pixels) and small for large $r$: dark values spread over a wide output range, exactly as (C) states. For power law with $\gamma<1$, $\dfrac{ds}{dr}=c\gamma\,r^{\gamma-1}$, and since $\gamma-1<0$, this is also large near $r=0$ and small near $r=L-1$, again expanding dark values, exactly as (D) states.
Step 5: Final answer.
Every option except (A) is true; (A) alone is incorrect because the negative transform is linear.\[ \boxed{\text{Option (A)}} \]