The term "relevant range" means the range of activity over which:
A)relevant costs are incurred.
B)costs may fluctuate.
C)production may vary.
D)the assumptions about fixed and variable cost behavior are reasonably valid.

Question

Quizplus · Accepted Answer

The relevant range refers to the range of activity over which the assumptions about fixed and variable cost behavior are reasonably valid. Within this range, fixed costs remain constant, and variable costs vary in proportion to the level of activity. Therefore, the relevant range is important for making cost-volume-profit (CVP) analysis and other managerial decisions.

The Term "Relevant Range" Means the Range of Activity Over