Computation of break-even point and sales volume required to generate a targeted profit (target profit analysis).
Cost volume and profit relationships exercises
Contribution margin income statement and break-even analysis of a multiproduct company.
Applications of CVP concepts. Impact of change in sales volume, sales price, variable and fixed costs.
Computation of degree of operating leverage. Preparation of contribution margin income statement.
Computation of contribution margin ratio (CM ratio) and margin of safety. Break-even and target profit analysis.