Which of the Following Is an Assumption Underlying Standard CVP

question 342

Multiple Choice

Which of the following is an assumption underlying standard CVP analysis?

• A) In multiproduct companies, the sales mix is constant.
• B) In manufacturing companies, inventories always change.
• C) The price of a product or service is expected to change as volume changes.
• D) Fixed expenses will change as volume increases.

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Definitions:

Contract

A voluntary agreement between two parties in which specific promises are made.

ATP

Adenosine triphosphate, an organic compound that provides energy to drive many processes in living cells, including muscle contraction and chemical synthesis.

Energy Production

The process of generating electricity or other forms of energy through various means such as fossil fuels, nuclear power, or renewable resources.

Fascia

A layer of connective tissue, mainly made of collagen, located under the skin, which serves to connect, stabilize, encase, and segregate muscles and various internal organs.