Cvp analysis and computer applications, Managerial Accounting

Assignment Help:

CVP ANALYSIS AND COMPUTER APPLICATIONS

The output from a CVP model is only as good as the input. The analysis will include assumptions about sales mix, production efficiency, price loads, total fixed costs, variable costs and selling price per unit.

The CVP equation can be used to develop financial planning programs. These programs quickly calculate the effects of changes in price, costs and volume on an organization’s profits. They result such “what- if” questions as:

How could a 5% increase in the sales price affect operating income?
If Fast Food Co. increases its advertising budget by Sh1 million, how many hamburgers must it sell to cover the increase in fixed expenses?
iIf the campus bookstore extends its hours, how much additional revenue must it earn to cover the increased operating expense?
If variable production costs are reduced by 7%, how many units of product must be sold to earn Sh 200,000 operating profit?

Related Discussions:- Cvp analysis and computer applications

Bank guarantees, Bank guarantee is one of the facilities which the commerci...

Bank guarantee is one of the facilities which the commercial banks extend in support of their clients in favour of third parties who will be the beneficiaries of the guarantees. In

Calculate the direct materials costs, XYZ Industries manufactures electroni...

XYZ Industries manufactures electronic testing equipment. XYZ also installs the equipment at customers' sites and ensures that it functions smoothly. Additional information on the

Budgetary controls, BUDGETARY CONTROLS Control in a business is the pro...

BUDGETARY CONTROLS Control in a business is the process of guiding organization into viable patterns of activity in an environment. The main purpose of a control system is to m

#titlCase Study - Labor standards, Case Study Labor standards Geeta & Comp...

Case Study Labor standards Geeta & Company has experienced increased production costs. The primary area of concern identified by management is direct labor. The company is conside

Factory layout-jit features, Factory Layout The first stage of implemen...

Factory Layout The first stage of implementing the JIT manufacturing techniques is to rearrange the factory floor away from the batch production functional layout towards a pro

Economies or diseconomies of scale , Economies or Diseconomies of Scale ...

Economies or Diseconomies of Scale The costs of a value activity are often subject to economies or diseconomies of scale. Economies of scale occur from the capability to perfo

Motives for holding cash, The firm's require holding cash may be attributed...

The firm's require holding cash may be attributed to the three motives specified below: The transaction motive The precautionary motive The speculative motive.

Ageing schedule, Ageing Schedule: AS is classifies outstanding accounts r...

Ageing Schedule: AS is classifies outstanding accounts receivable at a specified point of time into various age brackets. A clarifying ageing schedule is specified below.

Operating cycle method, Operating Cycle Method In this way, total opera...

Operating Cycle Method In this way, total operating expenses for a period are divided via the number of operating cycles in the relevant period to compute the cash need for wor

What is liquidity ratios, Liquidity ratios Liquidity refers to the abil...

Liquidity ratios Liquidity refers to the ability of concern to meet its current obligations as and when these become due. The short term obligations are met by realizing amount

Write Your Message!

Name

Email id

Message

Verfication Code

User Account

All Pages