An assumption of the CVP analysis is that the difference in inventory level at the beginning and at the end of a period is insignificant.

Question

Quizplus · Accepted Answer

This assumption is made in order to simplify the calculations and analysis of CVP by assuming that the inventory levels remain constant during the period being analyzed. However, it is important to note that significant changes in inventory levels can impact the accuracy of CVP analysis results.

An Assumption of the CVP Analysis Is That the Difference