Cost behavior analysis focuses on how costs
A) react to changes in profit.
B) react to changes in activity level.
C) change over time.
D) both a and c.

Question

Quizplus · Accepted Answer

Cost behavior analysis aims to understand how costs change in response to changes in activity level, such as production or sales volume. It does not directly focus on changes in profit or changes over time, although these factors may be considered as part of the analysis. Therefore, option B is the best choice.

Cost Behavior Analysis Focuses on How Costs