Cost-volume profit analysis is a managerial accounting technique which is used to determine how changes in costs and volume affect a company's operating income and net income. In CVP analysis there are certain assumptions: All units produced are sold. There is no closing inventory. Sales price per unit, variable cost per unit and total fixed cost remains constant. Costs are classified as either fixed cost or variable cost. Fixed cost is the cost which remains same at each level of activity. It remains constant in totality at each level of production volume. In the given question, we have to explain that why the fixed costs shows as a horizontal line on a CVP chart.

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Answer 1

Question

Chapter 21, Problem 16DQ

To determine

Cost-volume profit analysis is a managerial accounting technique which is used to determine how changes in costs and volume affect a company's operating income and net income.

In CVP analysis there are certain assumptions:

All units produced are sold. There is no closing inventory.

Sales price per unit, variable cost per unit and total fixed cost remains constant.

Costs are classified as either fixed cost or variable cost.

Fixed cost is the cost which remains same at each level of activity. It remains constant in totality at each level of production volume.

In the given question, we have to explain that why the fixed costs shows as a horizontal line on a CVP chart.

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Answer 2

Question

Chapter 21, Problem 16DQ

To determine

Cost-volume profit analysis is a managerial accounting technique which is used to determine how changes in costs and volume affect a company's operating income and net income.

In CVP analysis there are certain assumptions:

All units produced are sold. There is no closing inventory.

Sales price per unit, variable cost per unit and total fixed cost remains constant.

Costs are classified as either fixed cost or variable cost.

Fixed cost is the cost which remains same at each level of activity. It remains constant in totality at each level of production volume.

In the given question, we have to explain that why the fixed costs shows as a horizontal line on a CVP chart.

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Answer 3

Question

Chapter 21, Problem 16DQ

To determine

Cost-volume profit analysis is a managerial accounting technique which is used to determine how changes in costs and volume affect a company's operating income and net income.

In CVP analysis there are certain assumptions:

All units produced are sold. There is no closing inventory.

Sales price per unit, variable cost per unit and total fixed cost remains constant.

Costs are classified as either fixed cost or variable cost.

Fixed cost is the cost which remains same at each level of activity. It remains constant in totality at each level of production volume.

In the given question, we have to explain that why the fixed costs shows as a horizontal line on a CVP chart.

Expert Solution & Answer

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Answer 4

Question

Chapter 21, Problem 16DQ

To determine

Cost-volume profit analysis is a managerial accounting technique which is used to determine how changes in costs and volume affect a company's operating income and net income.

In CVP analysis there are certain assumptions:

All units produced are sold. There is no closing inventory.

Sales price per unit, variable cost per unit and total fixed cost remains constant.

Costs are classified as either fixed cost or variable cost.

Fixed cost is the cost which remains same at each level of activity. It remains constant in totality at each level of production volume.

In the given question, we have to explain that why the fixed costs shows as a horizontal line on a CVP chart.

Expert Solution & Answer

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Answer 5

Chapter 21, Problem 16DQ

To determine

Cost-volume profit analysis is a managerial accounting technique which is used to determine how changes in costs and volume affect a company's operating income and net income.

In CVP analysis there are certain assumptions:

All units produced are sold. There is no closing inventory.

Sales price per unit, variable cost per unit and total fixed cost remains constant.

Costs are classified as either fixed cost or variable cost.

Fixed cost is the cost which remains same at each level of activity. It remains constant in totality at each level of production volume.

In the given question, we have to explain that why the fixed costs shows as a horizontal line on a CVP chart.

Answer 6

Chapter 21, Problem 16DQ

To determine

Cost-volume profit analysis is a managerial accounting technique which is used to determine how changes in costs and volume affect a company's operating income and net income.

In CVP analysis there are certain assumptions:

All units produced are sold. There is no closing inventory.

Sales price per unit, variable cost per unit and total fixed cost remains constant.

Costs are classified as either fixed cost or variable cost.

Fixed cost is the cost which remains same at each level of activity. It remains constant in totality at each level of production volume.

In the given question, we have to explain that why the fixed costs shows as a horizontal line on a CVP chart.

Answer 7

Chapter 21, Problem 16DQ

To determine

Cost-volume profit analysis is a managerial accounting technique which is used to determine how changes in costs and volume affect a company's operating income and net income.

In CVP analysis there are certain assumptions:

All units produced are sold. There is no closing inventory.

Sales price per unit, variable cost per unit and total fixed cost remains constant.

Costs are classified as either fixed cost or variable cost.

Fixed cost is the cost which remains same at each level of activity. It remains constant in totality at each level of production volume.

In the given question, we have to explain that why the fixed costs shows as a horizontal line on a CVP chart.

Answer 8

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Answer 9

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Answer 10

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Answer 11

Ch. 21 - Cost behavior identification C1 Listed here are...Ch. 21 - QS 21-2 Cost behavior identification c1 ...Ch. 21 - QS 21-3 Cost behavior estimation—high-low method...Ch. 21 - Prob. 4QS Ch. 21 - Prob. 5QS Ch. 21 - Prob. 6QS Ch. 21 - Prob. 7QS Ch. 21 - Prob. 8QS Ch. 21 - Prob. 9QS Ch. 21 - Prob. 10QS

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