Short-term Decisions (4)

Question 1

Assumptions in relevant costing (Cost behaviour)

Answer 1

Cost behaviour patterns are known with certainty

Question 2

Assumptions in relevant costing (Certainty)

Answer 2

Costs, prices and volumes are known with certainty

Question 3

Assumptions in relevant costing (Objective)

Answer 3

Objective is to maximise profit/contribution

Question 4

Assumptions in relevant costing (Information)

Answer 4

Information is complete and reliable

Question 5

Can timescales also be relevant?

Answer 5

Yes

Question 6

Are many fixed csots varied?

Answer 6

Yes, but only in the the long-term