Question

A loss from operations cannot be analyzed using the CVP method.

A) True
B) False

Answer 1

A loss from operations can be analyzed using the CVP method.

Step-by-step explanation:

A loss from operations can be analyzed using the Cost-Volume-Profit (CVP) method. The CVP method helps in understanding the relationship between the costs, volume of production or sales, and the resulting profit or loss.

By using the CVP method, managers can conduct breakeven analysis, perform sensitivity analysis, and make informed decisions regarding pricing, product mix, and cost control.

Therefore, the statement that a loss from operations cannot be analyzed using the CVP method is False.