Essay on A Presentation Report on Cost–Volume–Profit Analysis (Cvp)

2168 Words Apr 15th, 2013 9 Pages
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Essay Sample
A presentation report on Cost–volume–profit analysis (CVP) Prepared for: Ms. Wahida Akther Lecturer Department of Business Administration Course code: ACC- 324 Course title: Taxation Prepared by: Group name: Exclusive NAME | ID | Omar Faruk | 1001010169 | Mirza Atiqul Hoque | 1001010182 | Minhaj Sultana | 1001010184 | Mushfiqur Rahman | 1001010186 | khairul Anam Choudhury | 1001010199 | Section:(D) 8th

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* The break-even point can be found using a mathematical equation, finding the point on a CVP graph or simply by using the contribution margin technique.

* A margin of safety is also displayed, which is the amount of sales at a break-even point and the actual or expected sales for the company. Next, the income is projected for certain products, this is known as the target net income.

* The Cost-Volume-Profit Analysis then closes with reporting changes in the business environment and revisits the CVP income statement to review profit analysis and projections over a period of time.

Component of CVP analysis:

Cost volume profit analysis (CVP analysis) is one of the most powerful tools that managers have at their command. It helps them understand the interrelationship between cost, volume, and profit in an organization by focusing on interactions among the following five elements: 

1. Prices of products

2. Volume or level of activity

3. Per unit variable cost

4. Total fixed cost

5. Mix of product sold

Because cost-volume-profit (CVP) analysis helps managers understand the interrelationships among cost, volume, and profit it is a vital tool in many business decisions. These decisions include, for example, what products to manufacture or sell, what pricing policy to follow, what marketing strategy to
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