List the most important assumptions of cost-volume-profit analysis.

Q: Define and explain the contribution margin ratio.

A: Contribution Margin: It is defined as the difference between the sales and the variable cost. In…

Q: Explain the following basic principles in cost management: a. profits b. life cycle costs c.…

A: basic principles in cost management explained Indirect costs Expenses which are  not readily…

Q: xplain the impact of risk, uncertainty, and changing variables on cost-volume-profit analysis.

A: Cost-volume-profit analysis is one of the decision accounting analytical approaches that aid in…

Q: What is Unit-Profit or Unit-Cost Calculation?

A: Cost:   It is the economic value of resources incurred by a firm to manufacture a product or render…

Q: Explain profit margin

A: Profit margin is one of the benefits proportions that's generally utilized to assess the level to…

Q: Which is more consistent with cost-volume-profit analysis, variable costing or absorption costing?…

A: Absorption Costing: "Absorption costing is a method that allocates "direct labor, direct materials,…

Q: Select the correct statement concerning the cost-volume-profit graph at right: a. The point…

A: BEP: (Break-even point) It is the number of units that are sold that could result in a situation of…

Q: What is meant by a product’s contribution margin ratio? How is this ratio useful in planningbusiness…

A: Contribution Margin Ratio: The contribution margin ratio shows the amount of difference in the…

Q: Describe analyzing of profit using contribution margin.

A: The contribution margin ratio is the percentage of difference in a company's sales and variable…

Q: Sort the following contribution margin income statement line items in the correct order from top…

A: Operating income is calculated after deducting the variable costs and fixed costs from the total…

Q: What is the difference between Cost-Volume Profit graph and Profit-Volume graph?

A: Introduction:- Cost-Volume Profit graph displays the relationship between the cost of units…

Q: What is the meaning of contribution margin ratio? How is this ratio useful in planning…

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Q: What is the standard cost income statement? Give an example?

A: Meaning of Standard cost income statement:A standard cost is the estimated cost of production based…

Q: What are the consequences of broad averaging on costs? Explain?

A: Broad Averaging:Broad averaging is also known as peanut butter cost is a costing approach of…

Q: Determining the best approach to pricing requires a cost-benefit trade-off. Explain.

A: The best approach to pricing requires the cost benefit trade-off is explained as below, The Best…

Q: What are the three components that can be described as the profit margin?

A: Income minus expenses gives us profit. The profit margin is the percentage of profits on sales or…

Q: What are the important points to remember in preparing the breakeven point graph? The…

A: Break-even point is the point at which company neither earns profits nor incurs loss. Break-even…

Q: Describe the components of contribution margin.

A: Contribution Margin: Contribution Margin refers to the margin of profit expected by the company. The…

Q: Calculate the cost efficiency - profit margin ratios

A: Return on Equity = Net Income available for Shareholders/Total Equity 2019 = 418,916/9,538,652 =…

Q: what is the definition and significance of contribution margin ratio

A: Contribution margin ratio Contribution margin ratio is also profit-volume ratio. It helps us to…

Q: Write the general formula for cost-plus pricing, and briefly explain its use.

A: Cost-plus pricing: It can be defined as the pricing strategy which includes the determination of the…

Q: What two assumptions are frequently made when estimating a cost function?

A: Cost Function:Cost function represents the basic change that occurs in the total cost due to the…

Q: “All the independent variables in a cost function estimated with regression analysis are cost…

A: Cost driver: Cost driver is one of the measurements that help the company in tracing directly the…

Q: How does the contribution margin affect the cost-volume-profit analysis?

A: Cost Volume Profit analysis means the breakeven analysis which generally used to determine the break…

Q: What is cost-efficiency according to profit projection?

A: Cost-effective usually means to reduce the expenses and excel in what you are doing or maintaining…

Q: Define the following terms: incremental cost, opportunity cost, and sunk cost.

A: Incremental Analysis: Incremental analysis refers to the analysis of differential revenue that could…

Q: Explain the impact of the cost-volume-profit connection on pricing strategy.

A: The cost volume profit analysis analyse the impact of the variable cost and fixed cost on the…

Q: Explain an example how to calculate contribution margin ratio.

A: Contribution margin ratio:   Contribution margin ratio is the difference between the company’s sales…

Q: 2. What is cost-volume-profit analysis and what are the important assumptions of this analysis?

A: Profit analysis entails dissecting a company's reported profit figure to determine the true extent…

Q: Discuss the Cost- Volume- Profit assumptions

A: Cost-volume-profit analysis: It is also called break-even analysis which measures the impact on…

Q: Define the terms market value added (MVA) and economic value added (EVA).

A: The concept of economic value added was developed by Stern Stewart & co & is also known as…

Q: h of the following is the format of the income statement that is MOST useful in decision-making?…

A: Solution: For the purpose of decision making, we need to have comparison of relevant revenues and…

Q: What is a cost-volume-profit analysis?

A: Cost: The amount paid to purchase the asset, install it, and put it into operations, is referred to…

Q: Distinguish between a profit center and an investment center. Draw a diagram illustrating the…

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Q: Which of the following statements is true when making decisions using cost-volume-profit (CVP)…

A: The contribution margin is calculated as difference between sales and variable costs. The net income…

Q: Explain the difference between target price and target cost.

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Q: Identify the relative advantages and disadvantages of basing transfer prices on total costs,…

A: Please find the answers to the above questions below: