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22 Cards in this Set
- Front
- Back
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break-even point
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the level of sales at which profit is zero
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the level of sales at which profit is zero
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break-even point
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Contribution margin ratio
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A ratio computed by dividing contribution margin by dollar sales
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A ratio computed by dividing contribution margin by dollar sales
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Contribution margin ratio
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CM Ratio
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Contribution margin ratio
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Cost-volume-profit graph
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A graphical representation of the relationships between an organization's revenues, costs, and profits on the one hand and its sales volume on the other hand
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A graphical representation of the relationships between an organization's revenues, costs, and profits on the one hand and its sales volume on the other hand
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Cost-volume-profit graph
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CVP graph
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Cost-volume-profit graph
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Degree of operating leverage
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A measure, at a given level of sales, of how a percentage change in sales will affect profits. The degree of operating leverage is computed by dividing contribution margin by net operating income
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A measure, at a given level of sales, of how a percentage change in sales will affect profits. Computed by dividing contribution margin by net operating income
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Degree of operating leverage
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Incremental analysis
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An analytical approach that focuses only on those costs and revenues that change as a result of a decision
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An analytical approach that focuses only on those costs and revenues that change as a result of a decision
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Incremental analysis
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margin of safety
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the excess budgeted (or actual) dollar sales over the break-even dollar sales
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the excess budgeted (or actual) dollar sales over the break-even dollar sales
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margin of safety
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operating leverage
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a measure of how sensitive net operating income is to a given percentage change in dollar sales
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a measure of how sensitive net operating income is to a given percentage change in dollar sales
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operating leverage
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sales mix
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the relative proportions in which a company's products are sold. Computed by expressing the sales of each product as a percentage of total sales
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the relative proportions in which a company's products are sold. Computed by expressing the sales of each product as a percentage of total sales
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sales mix
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target profit analysis
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estimating what sales volume is needed to achieve a specific target profit
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estimating what sales volume is needed to achieve a specific target profit
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target profit analysis
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variable expense ratio
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a ratio computed by dividing variable expenses by dollar sales
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a ratio computed by dividing variable expenses by dollar sales
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variable expense ratio
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