Consider the following statements: Statement 1: The Marginal Cost of a product is the change in total cost resulting from producing one additional unit, encompassing direct materials, labor, expenses, and variable overheads while excluding fixed costs. Statement 2: Under the CVP framework, the Profit Volume (PV) Ratio remains constant as long as the selling price and variable cost per unit do not change, even if sales volume fluctuates. Statement 3: When a product's contribution is negative (selling price is lower than variable cost), marginal costing dictates that production should be stopped immediately unless strategic reasons exist. Which of the following evaluations of these statements is most accurate?

Which of the following statements regarding Marginal Costing are NOT true? I. Closing stock valuation includes variable manufacturing costs. II. Marginal costing encourages lowering selling prices below variable costs in normal conditions. III. Under marginal costing, overheads are traditionally classified into functional heads (factory, admin, selling). IV. Marginal costing highlights the Cost-Volume-Profit relationship.

Which of the following are key assumptions of Marginal Costing? (a) All cost elements can be segregated into fixed and variable components. (b) Total fixed cost remains constant at all levels of output. (c) Total variable cost varies proportionally with output volume. (d) Selling price per unit remains constant across operating levels.