You were talking to your roommate one day about CVP analysis and the approaches that are used
Question:
Your roommate proclaimed, “Wow, you people in accounting are pretty simple. Do you realize how unrealistic it is to assume that, no matter how many units you sell, you will realize the same price per unit? And, I’ve never heard any serious person suggest that costs are linear. How can you possibly state that assumption with a straight face? In your world, profit maximization is simple . . . just produce the maximum amount possible.”
Provide a written justification of the assumptions accountants make in conducting CVP analysis that will satisfy your critical economist roommate.
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Related Book For
Cost Accounting Foundations and Evolutions
ISBN: 978-1111626822
8th Edition
Authors: Michael R. Kinney, Cecily A. Raiborn
Question Posted: