TRUE OR FALSE. Please write TRUE if statement is correct and FALSE If it is Incorrect. 1. Cost behavior analysis is the study of how specific costs respond to changes In the level of activity within a company. 2. Cost behavior analysis is important to management in planning business operations and in deciding between alternative courses of action. 3. Fixed costs and variable cost may be defined in total or on a per-unit basis. Variable costs in total vary directly and proportionately with changes in the activity level. Fixed costs per unit remain the same at every level of activity. 4. Fixed costs remain the same in total regardless of changes in the activity level, In contrast, fixed costs per unit vary directly with activity. As volume increases, fixed costs per unit decline and vice versa. 5. The relevant range is the range of activity that a company expects to operate during the year 6. The behavior of both fixed and variable costs are linear only over a certain range of activity. 7. Most companies operate within the relevant range. Within this range, it is possible to establish a linear (straight-line) relationship for both variable and fixed costs. If a relevant range cannot be established, segregation of costs into fixed and variable becomes extremely difficult. 8. For CVP analysis, mixed costs must be classified into their fixed and variable elements, One approach to the classification of mixed costs is the high-low method. 9. Only two of the basic components of cost-volume-profit (CVP) analysis, unit selling prices and variable cost per unit, relate to unit data. The other component, total fixed costs, are not based on per-unit amounts. 10. Degree of operating leverage is the difference between actual or expected sales and sales at the breakeven point. 11. Supervisory salaries is usually a Fixed non manufacturing cost if the salary pertains to Factory supervisor. 12. All indirect costs of a factory operation are period cost. 13. All period cost are non manufacturing costs, but not all nonmanufacturing costs are period cost. 14. In comparing Margin of Safety between months' sales, the absolute amount must be compared, instead of the Margin of Safety Ratio, to determine which month performs better. 15. The Degree of Operating Leverage can only predict percentage increase of profit based from percent increase in sales, but not in peso value. is incurring monthly rental of