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Chapter 4 cost-volume-profit analysis: a managerial planning tool. ex. on pg 125: change in income from operations = change in sales dollars x cm ratio. ex. on pg 125: variable costs as a % of sales r equal to 100% - the cm ratio (ex. on pg 125, cm ratio is useful in developing business strategies (ex. on pg 126) Unit contribution margin y unit contribution margin is useful for analyzing the profit potential of proposed decisions: unit cm = sales price per unit variable cost per unit. ex. on pg 126: change in income from operations = change in sales units x unit cm. ex. on pg 126 y ex. on bottom & cornerstone 4-1 on pg 126-127. If variable cost ratio is shown, it can be subtracted from 1 to calculate the cm ratio (1-

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