If production does not equal sales,
A)it must adjust the CVP formulas for that fact if it wishes to use CVP.
B)it cannot use CVP,as an assumption is violated.
C)a CVP analysis will always indicate a breakeven point that cannot be reached.
D)the conclusions it draws from a CVP analysis will not be as sound as they would be if production equaled sales.

Question

Quizplus · Accepted Answer

When production does not equal sales, the assumptions of CVP analysis are affected, potentially leading to less reliable conclusions.

If Production Does Not Equal Sales