The reliability of computer models used in CVP analysis depends on the accuracy of their underlying assumptions about how revenues and costs may actually be affected.

Question

Quizplus · Accepted Answer

The accuracy of assumptions is crucial for the reliability of computer models used in CVP analysis, as these assumptions form the basis for revenue and cost estimates. If assumptions are faulty, the resulting analysis and decision-making may also be incorrect.

The Reliability of Computer Models Used in CVP Analysis Depends