CVP Flashcards
1
Q
What is the Break-Even point?
A
Sales = Total Costs
2
Q
What do we assume is constant when finding the Break-Even point?
A
Selling price per unit
3
Q
How is contribution per unit calculated?
A
Selling price per unit - variable cost per unit
4
Q
How is ‘sales volume to reach required profit level’ calculated?
A
(Fixed costs + Required profit) / Unit contribution
5
Q
How is Margin of Safety calculated?
A
(Budgeted sales volume - break even sales volume) / (Budgeted sales volume ) x 100
