CVP analysis can be used to make decisions about discretionary expenditures, such as:
A) Advertising
B) Taxes
C) Direct materials purchases
D) City license fees

Question

Quizplus · Accepted Answer

CVP analysis can help determine the level of advertising spending needed to achieve a certain level of sales and profits. Taxes, direct materials purchases, and city license fees are not discretionary expenditures and are typically more fixed in nature.

CVP Analysis Can Be Used to Make Decisions About Discretionary