In the graph method of CVP analysis, ________.
A) The total revenue line starts at the origin and the total costs line starts at the fixed intercept.
B) The operating income line starts at the origin and the total costs line starts at the fixed intercept.
C) The breakeven point is at the fixed intercept where the total revenues line intersects.
D) The operating income area is the section where the total costs line is above the total revenues line.

Question

Quizplus · Accepted Answer

In the graph method of CVP analysis, the total revenue line starts at the origin and the total costs line starts at the fixed intercept. The breakeven point is where these two lines intersect, and the operating income area is the section where the total revenues line is above the total costs line. Therefore, choice A is the correct answer.

In the Graph Method of CVP Analysis, ________