The relevant range is:
A) the range in which costs remain variable.
B) the range of activity over which we expect our assumptions about cost behavior to hold true.
C) the range of activity based on the volume-based cost driver.
D) the range in which costs remain fixeD.
The relevant range is the range of activity over which we expect our assumptions about cost behavior to hold true.

Question

Quizplus · Accepted Answer

The relevant range is defined as the range of activity over which we expect our assumptions about cost behavior to hold true. This means that it is the range in which the cost driver (usually volume-based) affects the cost in a predictable way. Therefore, option B is the correct answer. Options A and D are incorrect because they refer to cost behavior outside of the relevant range, and option C is not completely accurate since the relevant range is not based on the cost driver itself, but on the expected behavior of costs within that range.

The Relevant Range Is