Which of the Following Is $\textbf{ not }$

question 15

Multiple Choice

Which of the following is $\textbf{ not }$ an assumption about the data when using CVP analysis?

• A)All costs can be easily and accurately separated into fixed and variable components.
• B)Total fixed costs remain at a constant level and variable costs per
• C)A linear relationship exists between variable costs and sales activity over the relevant range of interest.
• D)Inventory is sold in the period following purchase or manufacture.

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Definitions:

Cash Receipts

The total amount of money, including cash, checks, and electronic transfers, received by a business during a given period.

Accounting Records

Documentation and books that maintain a systematic record of financial transactions and positions of a business.

Invoice Price

The amount charged by a seller for goods or services, exclusive of any discounts or allowances.

Journal Entries

The written records of financial transactions in the accounting system, indicating the accounts and amounts debited and credited.