Cost-volume-profit relationships that are curvilinear may be analyzed linearly by considering only:

Question

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Curvilinear cost-volume-profit relationships can be analyzed linearly by focusing only on a relevant range of volume. This means that the range of activity levels under consideration should be such that fixed costs and variable costs remain relatively constant. By limiting the analysis to a relevant range of volume, the relationship between costs, volume, and profits can be approximated as a straight line, even when actual cost behavior is curvilinear. The other options, such as fixed and semi-variable costs or relevant fixed costs, do not fully address the issue of curvilinear cost-volume-profit relationships.

Cost-Volume-Profit Relationships That Are Curvilinear May Be Analyzed Linearly by Considering