ECONOMICS

Detailed explanation-1: -The main assumptions that accountants make when using cvp analysis are that fixed costs will not change within the relevant range of activity, all costs can be classified into fixed and variable, the selling price per unit will stay constant, and fixed costs remain constant.

Detailed explanation-2: -The reliability of CVP lies in the assumptions it makes, including that the sales price and the fixed and variable cost per unit are constant. The costs are fixed within a specified production level. All units produced are assumed to be sold, and all fixed costs must be stable.

Detailed explanation-3: -Overall fixed cost will remain constant but fixed costs per unit will decrease as volume increases. Therefore this statement as it is written is not an assumption o CVP analysis.

Detailed explanation-4: -The answer is b) Relevant range includes all possible levels of activity that a company might experience. The relevant range represents the range of production volume whereby the sales price per unit, variable cost per unit, and overall fixed cost do not change.