With respect to fixed costs,CVP analysis assumes total fixed costs
A)per unit remain constant as volume changes.
B)remain constant from one period to the next.
C)vary directly with volume.
D)remain constant across changes in volume.

Question

Quizplus · Accepted Answer

CVP analysis assumes that total fixed costs remain constant across changes in volume. This means that regardless of how many units are produced or sold, the total amount of fixed costs incurred by the business will not change. However, it is important to note that while total fixed costs remain constant, fixed costs per unit may vary depending on the volume produced or sold.

With Respect to Fixed Costs,CVP Analysis Assumes Total Fixed Costs