ACC 410 Chapter Notes - Chapter 3: Gross Margin, Nonlinear Functional Analysis, Regression Analysis
Document Summary
Chapter 3: cost - volume - profit (cvp) analysis. Cvp analysis: cvp analysis looks at the relationship between selling prices, sales volumes, costs, and profits, use cvp analysis to provide information about the following: future levels of operating activities. How much to budget for discretionary expenditures the amount of revenue required to avoid losses. V = variable cost per unit of activity (s - v) = contribution margin per unit (cm ) where: Cmr = s - v = total revenue - total variable costs. The breakeven point (bep) is where total revenue equal total costs: calculate bep from preceding cvp formulas by setting ebit to zero. The cvp graph shows the relationship between total revenues and total costs. Breakeven point example: bill"s briefcases makes high quality cases for laptops that sell for . The variable costs per briefcase are , and the total fixed costs are ,000. Find the bep in units and in sales $ for this company.
