Which One of the Following Is Not an Assumption of CVP

question 93

Multiple Choice

Which one of the following is not an assumption of CVP analysis?

• A) All units produced are sold.
• B) All costs are variable costs.
• C) Sales mix remains constant.
• D) The behavior of costs and revenues are linear within the relevant range.

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Definitions:

Privity of Contract

A legal concept that restricts the rights or duties arising under a contract to the parties who agreed to it.

Contractual Relation

A legally binding agreement between two or more parties that outlines the rights and duties of each party.

Tacit Agreement

An understanding or agreement that is implied from actions or circumstances, not explicitly stated.

Implied Warranty

An unwritten and unspoken guarantee that a product will meet a minimum level of quality and reliability.