Which of the following is not an assumption of CVP analysis?

Select one:

A. Total fixed cost and total variable cost per unit are constant over the entire range of analysis.

B. Sales price will remain constant on a per-unit basis regardless of the level of sales.

C. The sales mix ratio (for multiple products) remains constant.

D. All costs are variable in the relevant range.

E. All of the above

PART 2-

When a company has high operating leverage:

Select one:

A. It has low fixed costs.

B. It borrows to cover most costs.

C. It has high variable costs relative to fixed costs.

D. It has high fixed costs relative to variable costs.

E. None of the above

PART 3-

Which of the following statements is true regarding CVP analysis?

Select one:

A. CVP is only useful in a manufacturing context

B. CVP can be used with multiple products only if the product ratio is fixed and based on a weighted average unit contribution margin

C. CVP cannot be used in service industries

D. CVP is useful in all types of business and with any number of products and product mixes

E. None of the above