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Cost volume profit analysis
Meaning and definition
Cost volume profit analysis is a technique for studying the relationship between cost volume and profits . profits of an undertaking depend upon a large number of factors. But the most important of these factor are the cost of manufacture volume of sales and the selling prices of the products.
In the words of herman c . heiser the most significant single factor in profit planning of the average business is the relationship between the volume of business costs and profit . the CVP relationship is an important tool used for the profit planning of a business .
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What nonfinancial factors should management consider in making its decision on whether to accept or reject a special order?
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How can we draw a break even chart Under this method the variable cost line is drawn first and then fixed cost line is drawn over and parallel to the variable cost line. The fi
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