A technique that uses the degrees of cost variability to measure the effect of changes in volume on resulting profits is:
A)Standard costing.
B)Variance analysis.
C)Cost-volume-profit analysis.
D)Segment profitability analysis.

Question

Quizplus · Accepted Answer

Cost-volume-profit analysis (CVP) is a technique that helps in understanding the impact of changes in volume, sales mix, and selling price on the profits of a business. It uses the degrees of cost variability to measure the effect of changes in volume on resulting profits. It is a commonly used tool for making decisions related to pricing, product mix, and sales volume.

A Technique That Uses the Degrees of Cost Variability to Measure