The analytical method that does not rely on assumptions is:
A) regression analysis
B) cost-volume-profit analysis
C) cost allocation
D) none of the above

Question

Quizplus · Accepted Answer

All the listed analytical methods (A, B, C) rely on certain assumptions to some extent. Regression analysis assumes a linear relationship between variables, cost-volume-profit analysis assumes constant unit variable costs and fixed costs over a relevant range, and cost allocation methods assume a rational basis for distributing costs among cost objects. Therefore, none of the options provided are methods that do not rely on assumptions.

The Analytical Method That Does Not Rely on Assumptions Is