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COST PROFIT VOLUME ANALYSIS
Cost profit volume (CVP) analysis is an essential tool for profit planning. It can be explained as - ' a managerial tool showing the relationship among various ingredients of profit planning, that is, cost (fixed and variable), volume and selling price of activity. It presents information regarding-
1. Quantity of production and sales for a target profit level
2. Behavior in relation to volume
3. Amount of profit for a projected sales volume
4. Sensitivity of profits due to variation in output
5. Volume of production or sales, where the business will break even.
Adele Weiss manages the campus flower shop. Flowers must be ordered three days in advance from her supplier in Mexico. Advance sales are so small that Weiss has no way to estimate
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Prepare the Material Cost Budget of products of a Company For a company along with many products, a periodic budget would be developed given as: Assume a firm has 3 products X
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