Question

Cost behavior is useful to managers for all of the following except:__________.

a. Whether to replace a machine.
b. To predict profits as sales and production volume changes.
c. To estimate costs.
d. None of these choices are correct.

Answer 1

D

Step-by-step explanation:

Cost behavior is defined as the measure of the reaction of the cost to outputs in production and sales volume.It reveals the impact of changes in activities on cost.

This helps the management in planning and controlling its costs and drive profits.

Cost behavior can be useful to the manager in deciding whether to replace a machine or not as the efficiency rate of a machine tends to reduce due to impairment , causing a rise in cost.

So also , it can be useful in predicting profits as sales and production volume changes and also to estimate cost.