Cost-volume-profit analysis
5 important questions on Cost-volume-profit analysis
Describe how the special case labelled CVP is different from the general case for predicting total revenues, total costs and operating profit.
Distinguish between operating profit and net profit
Describe the assumptions underlying CVP analysis
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'CVP is both simple and simplistic. If you want realistic analysis to underpin your decisions, look beyond CVP.' Do you agree? Explain.
'There is no such thing as a fixed cost. All costs can be "unfixed" given sufficient time.' Do you agree? What is the implication of your answer for CVP analysis?
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