Saved Bookmarks
| 1. |
What Is Cvp Analysis? |
|
Answer» Profit is the most important measure of the firm’s performance. In the free-market economy, profit is a guide for allocating RESOURCES efficiently. An analysis of the EFFECTS of various factors on PROFITS is an essential step in the financial planning and decision-making. The ANALYTICAL technique used to study the behavior of profit in response to the changes in volume, costs and PRICES is called the cost-volume-profit (CVP) analysis. Profit is the most important measure of the firm’s performance. In the free-market economy, profit is a guide for allocating resources efficiently. An analysis of the effects of various factors on profits is an essential step in the financial planning and decision-making. The analytical technique used to study the behavior of profit in response to the changes in volume, costs and prices is called the cost-volume-profit (CVP) analysis. |
|