Why is relevant range important to decision making? How can it be impacted?
Relevant range means a specific range of level that bracket by minimum and maximum account
The concept of ralevent range have two analysis
Budgeting:
On preparation of budget company use relevant range assumption to estimate revenue and expensive .
Cost assumption:
Relevant range is a range of production on which Fixed cost remain unchanged till that range.
Relevant range is important because of following reason mentioned above . Because if production go out of relevant range that can be change in fixed expenses.
As well as budget can be impacted by external factors
Why is relevant range important to decision making? How can it be impacted?
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