What are two examples of the types of management issues that can be addressed by cvp analysis?
What are two examples of the types of management issues that can be addressed by cvp analysis?
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter2: Financial Reporting: Its Conceptual Framework
Section: Chapter Questions
Problem 29GI
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What are two examples of the types of management issues that can be addressed by cvp analysis?
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CVP or Cost-volume-profit analysis is a cost accounting method of analysing the effect of cost and volume at different levels on the operating profit, how changes in variable and fixed costs affect the the profit margin . CVP analysis is used to determine the break-even point, i;e the number of units to be sold in order to cover up all the costs, it is a position of no profit no loss where revenue is equal to total costs.
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