Answer the following questions using the information below:
Franscioso Company sells several products. Information of average revenue and costs is as follows:

-All of the following are assumed in the above analysis EXCEPT:
A)a constant product mix
B)all costs can be classified as either fixed or variable
C)cost and revenue relationships are reflected accurately
D)per unit variable costs increase when activity increases

Question

Answer the following questions using the information below:
Franscioso Company sells several products. Information of average revenue and costs is as follows:
 
-All of the following are assumed in the above analysis EXCEPT:
A)a constant product mix 
B)all costs can be classified as either fixed or variable 
C)cost and revenue relationships are reflected accurately 
D)per unit variable costs increase when activity increases

Quizplus · Accepted Answer

The assumption that per unit variable costs increase when activity increases contradicts the information given in the table, which shows a constant per unit variable cost for each product. Therefore, this assumption is not made in the analysis.

Answer the Following Questions Using the Information Below