Which of the Following Is an Assumption of CVP Analysis

question 116

Multiple Choice

Which of the following is an assumption of CVP analysis?

• A) Total costs can be divided into a fixed component and a component that is variable with respect to the level of output.
• B) When graphed, total costs curve upward.
• C) The unit-selling price is variable as it is subject to demand and supply.
• D) Total costs can be divided into inventoriable and period costs with respect to the level of output.

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Definitions:

Balanced Scorecard

A strategic planning and management system used to align business activities to the vision and strategy of the organization, improve internal and external communications, and monitor organizational performance against strategic goals.

Financial

Relating to money or how money is managed, including aspects such as investments, expenses, and revenue generation.

Customer

An individual or entity that purchases goods or services from another entity, forming the basis of the business's revenue.

Learning And Growth

An aspect of the balanced scorecard approach that focuses on the intangible drivers of future success, such as employee skills, organizational culture, and information systems capabilities.