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If the volume goes up what happens to the fixed cost and profit?
Wiki User
∙ 16y ago
what effect does an increase in volume have on fixed cost per unit
Wiki User
∙ 9y ago
Wiki User
∙ 16y agoFixed Costs stay the same. Profit goes up.
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What type of cost is fixed per unit of output and changes with volume of output?
varible?
Cost-volume-profit CVP analysis is based entirely on unit costs?
The CVP analysis determines the changes in costs and volume that affects a company's operating income and net income. However it assumes that the sales price, variable costs and the total fixed costs per unit remain constant
A fixed supply means?
A supply such as office paper that has a fixed cost.
How are the principles of allocation different for profit and not-for-profit organizations?
An important point to remember is that the principles of allocation are the same for for-profit and not-for-profit organizations. The only difference is that the cost objects will be dissimilar.
What is a fixed cost ratio?
Here's an example - If a company knows that a product costs a certain amount (wholesale) that's a fixed cost. Now, they usually mark up that price three times before they sell it to you. Their fixed cost ratio is 1/3. If they mark it up five times the cost, their ratio is 1/5.
What is break even analysis and how does it work with cost volume profit analysis?
cost volume profit is use anlyse how cost and profit change with change in volume of activity
What is V ratio?
The Profit Volume (PV) Ratio is the ratio of Contribution over Sales. It measures the Profitability of the firm and is one of the important ratios for computing profitabilty. The Contribution is the extra amount of sales over variable cost. Contribution is also Fixed cost plus profit. Profit = Sales - Variable Cost - Fixed Cost. Thus Contribution is: Profit + Fixed Cost = Sales - Variable Cost. Therefore PV Ratio = (Contribution/Sales)X100. (This as a percentage of sales)
What is p v ratio?
The Profit Volume (PV) Ratio is the ratio of Contribution over Sales. It measures the Profitability of the firm and is one of the important ratios for computing profitabilty. The Contribution is the extra amount of sales over variable cost. Contribution is also Fixed cost plus profit. Profit = Sales - Variable Cost - Fixed Cost. Thus Contribution is: Profit + Fixed Cost = Sales - Variable Cost. Therefore PV Ratio = (Contribution/Sales)X100. (This as a percentage of sales)
How do you calculate fixed cost given total cost and sales volume?
Fixed cost = total cost / sale volume
How Cost Volume Profit cost-volume-profit analysis would help managers in their decision making?
Cost volume profit analysis is a basic financial analysis tools to determine the underlying profitability of a company. Its components include activity level, price per unit, variable cost per unit and total fixed cost.
What is cost-volume-profit analysis based on?
The analysis is based on a set of linear equations for a straight line and the separation of variable and fixed costs.
What are the differences between cost volume profit analysis and break even profit analysis?
there no difference between break even profit analysis and cost volume profit analysis
What is the formula of marginal costing?
sale-variable cost=(contribution)-fixed cost =(profit):this is the statement of marginal cost. (profit volume ratio)p/v ratio=contribution÷sales x 100 mos(margin of safety)=actual sales-break even point(BEP)sales. mos(margin of safety)units=actual sales(units)-break even point(BEP)sales.(units) BEP(rs)=fixed cost ÷ pv ratio BEP(units)=fixed cost ÷ contribution per units required sales(rs)=fixed cost+desired profit ÷ pv ratio required sales(units)=fixed cost+desired profit ÷ contribution per unit . ( there is different formula for..when 2yr profit & sales are given) (
What is the cost volume profit analysis?
cvp is the analysis that deals with how profits and cost change with a change in volume
What is the purpose of Cost volume profit analysis?
b
How would you define cost-volume-profit analysis?
Cost-volume-profit analysis (CVP), or break-even analysis, is used to compute the volume level at which total revenues are equal to total costs.
Is depreciation fixed cost?
Yes depreciation is fixed cost because it do not vary with the volume of production and remained fixed whether any production or not.
