Chapter 6 Cost Volume Profit Analysis

Question 1

Cost volume profit analysis

Answer 1

the study of the effects that changes in costs and volume have on a company’s profits.

Question 2

cost-volume-profit (CVP) income statement

Answer 2

classifies costs as variable or fixed and calculates a contribution margin.

Question 3

Contribution Margin

Answer 3

is the amount of revenue that remains after variable costs have been deducted. It is often stated both as a total amount and on a per-unit basis.