Cost Volume Profit

Question 1

Cost Volume Profit CVP

Answer 1

study of the effects on future profit of changes in fixed costs, variable cost, sales price, quantity and mix

Question 2

Contribution

Answer 2

sales value - variable costs

Question 3

Breakeven Point in Units

Answer 3

Fixed costs
/
contribution per unit

Question 4

Breakeven Point in Sales Revenue

Answer 4

Fixed costs
/
contribution per unit

X Selling Price

or
Fixed costs
/
Contribution to sales ratio

Question 5

Margin of Safety in Units

Answer 5

budgeted sales - breakeven sales

Question 6

Margin of Safety in %

Answer 6

budgeted sales - breakeven sales
/
budgeted sales

Question 7

Contribution to Sales Ratio

Answer 7

contribution
/
sales

Question 8

Sales Req’d for a Target Profit

Answer 8

(Fixed costs + profit)
/
contribution per unit

or

(Fixed costs + profit)
/
contribution to sales ratio