Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. what are the biggest challenges for managers using

What are the biggest challenges for managers using cvp analysis to make product decisions? Why?

80.2K

Verified Solution

Question

Accounting

What are the biggest challenges for managers using cvp analysisto make product decisions? Why?

Answer & Explanation Solved by verified expert
3.7 Ratings (498 Votes)
In spite of CVP being a useful technique it suffers from some of the following challenges for the managers 1 Because of the many assumptions CVP is only an approximation at best CVP analysis needs estimates and approximation in assembling necessary data and thus lacks accuracy and precision 2 In CVP analysis it is assumed that total sales and total costs are linear and can be represented by straight lines In some cases this assumption may not be found true For instance if a business firm sells more units the variable costs per unit may decrease due to more operating efficiencies in the factory 3 CVP analysis is    See Answer
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Zin AI - Your personal assistant for all your inquiries!
Become a Member

Transcribed Image Text

What are the biggest challenges for managers using cvp analysisto make product decisions? Why?

Other questions asked by students

Q

explain how emotions affect memory

Psychology
Q

Strategic planning in dynamic environment 5. Identify Porter’s five competitive forces and explain how they determine industry...

General Management
Q

What is the days supply for this prescription?Amoxicillin 125mg/5ml Suspension #200mlSig: ii tsp BID20 days10...

Biology
Q

High heat of vaporization Hydrophobic exclusion High solubility of ions and polar molecules Ice is...

Biology
Q

P 1x105 T At place s to complete one vibration The value of the earth...

Physics
Q

Fill the following truth table P 9 T T T F T F Required information...

Basic Math
Q

Phillip Evans - How Date will transform business I'm going to talk a little bit...

Accounting
Q

Campbell Company currently produces and sells 7,600 units annually of a product that has a...

Accounting
Q

Franklin Manufacturing Company was started on January 1, Year 1, when it acquired $89,000 cash...

Accounting
Q

ACCT 3002 -E3A Final Fall 2017 Question (8) Dividends I5 pointsl The equity section of...

Accounting
Q

John and Sally Claussen are considering the purchase of a hardware store from John Duggan....

Accounting
Q

identify betas for the given company turkish airlines

Finance