Significance of the Relevant Range to CVP Relationships

Instructions:

Choose an answer and hit 'next'. You will receive your score and answers at the end.

question 1 of 3

In the relevant range, costs are assumed to:

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1. Which of the following would be considered a variable cost?

2. Calculate the variable cost per unit given the following information: total variable costs = $1,000; total fixed costs = $500; total units produced = 200.

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About This Quiz & Worksheet

The importance of relevant range is the subject of this combination of a quiz and worksheet. Questions will address what costs are assumed to do in relevant range, as well as examples of what would be considered a variable cost.

Quiz & Worksheet Goals

You can expect to see the following topics on this worksheet:

  • The expectation of costs in relevant range
  • Variable cost examples
  • Results of a company operating above its relevant range
  • Assumptions in cost-volume-profit analysis

Skills Practiced

  • Problem solving - utilize your skills to solve a problem involving variable cost per unit
  • Information recall - remember what you have learned about variable cost examples
  • Knowledge application - use what you know to answer questions about operating above relevant range

Additional Learning

To see more information, check out the lesson titled Significance of the Relevant Range to CVP Relationships. With it, you can review the following:

  • CVP analysis
  • Mixed costs
  • Profit margins
  • Real-world examples using CVP analysis
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