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Q. Explain Break-even analysis?
Cost-volume-profit (CVP) analysistracks that how profit changes when there are changes insales price, variable costs, fixed costs &quantity.
It is a good illustration of "what if? "Analysis and it in particular looks at sales minus variable costs which is termed as contribution.It permits management to understand the level of sales needed to cover all costs of a project and what level of sales is required start making profits.To break even would mean that an organisation would be earning no profit and no loss.
Sales revenue = All variable and fixed cost
Main assumptions in this model are thatfixed costs, selling price and variable costs are constant.
Sensitivity Analysis The only certain thing is that nothing is sure thing. Cost structures can be anticipated to vary over the time period. Management should vigilantly analyze
PROFIT VARIANCES Sales variances are important as they have a direct bearing on profits earned by the organization. thus, they can be used as the basis of determining profit
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prepare an overhead analysis sheet
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why is determining the cost to manufacture a product quite a different activity from determining how to control such cost?
please concept clear me cost accounting for example, we manufacturing any product
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