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11 Cards in this Set
- Front
- Back
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What is CVP Analysis |
Relationship among revenues, cost and volume and their effect on profit. |
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Why do CVP Analysis |
To support managers in pricing and production decisions that increase profit. |
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Profit Equation |
Profit= TR - TC |
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Unit contribution margin |
Sales price per unit minus variable cost per unit |
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Total contribution margin |
Total revenues minus total variable cost. |
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Break-even point |
Volume where profit equals zero |
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Break-even volume in units formula |
Fixed cost÷Unit contribution margin |
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Contribution margin ratio |
Unit contribution margin÷sales price |
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Unit contribution margin |
Difference between revenues per unit (price) and variable cost per unit. |
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Total contribution margin |
Difference between revenues and total variable cost |
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Break-even volume in sales dollars |
Fixed costs÷contribution margin ratio |
