When predicting costs at different volumes,managers should consider which of the following?
A)The relevant range of the cost
B)The type of cost behavior
C)Neither of the above
D)Both of the above

Question

Quizplus · Accepted Answer

When predicting costs at different volumes, managers should consider both the relevant range of the cost and the type of cost behavior. The relevant range refers to the range of activity within which the assumptions made about cost behavior are valid. Different cost behaviors (such as fixed or variable costs) will have different cost-volume relationships, which will affect how costs behave at different levels of activity. Therefore, managers must consider both factors to accurately predict costs at different volumes.

When Predicting Costs at Different Volumes,managers Should Consider Which of the Following