Cost estimates made using activity levels outside the relevant range:
A)Are more accurate.
B)May result in poor decisions.
C)Mean that cost behavior patterns are accurate at all levels of activity.
D)Mean the cost estimates will be relevant.
E)None of the answer choices is correct.

Question

Quizplus · Accepted Answer

Cost estimates made using activity levels outside the relevant range may result in poor decisions because cost behavior patterns may not be accurate at higher or lower levels of activity. It is important to use activity levels within the relevant range to ensure the accuracy of cost estimates.

Cost Estimates Made Using Activity Levels Outside the Relevant Range