To which function of management is CVP analysis most applicable?
A) Planning
B) Motivating
C) Directing
D) Controlling

Question

Quizplus · Accepted Answer

CVP (Cost-Volume-Profit) analysis is a financial tool that helps in determining the relationship between cost, volume, and profitability of a business. It is mostly used during the planning process to determine the level of sales needed to generate targeted profits and to identify the most profitable product or service. Therefore, it is most applicable to the planning function of management.

To Which Function of Management Is CVP Analysis Most Applicable