chapter 7 cost volume profit analysis, break even point, target profit ROS, margin of safety, insourcing vs outsourcing

Question 1

basing of last question round profit =

Answer 1

revenue-variable-fixed

CM - fixed

CM = revenue - variable

Question 2

break even point (zero profit)

Answer 2

fixed cost/cm

rearrange first question

Question 3

critical sales revenue

Answer 3

revenue needed to break even (just use break even point and x price)

Question 4

target profit

Answer 4

TP = cmxq -Cf

Question 5

critical quantity

Answer 5

qTP = (Cf + TP) / cm