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Flashcards in EXAM 2 Deck (9)
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1

CMR FORMULA

CM / SALES

2

FORMULA: QUANTITY TO SELL FOR DESIRED PROFIT

P = (UNIT CM)(Q) - FIXED

3

FORMULA: MARGIN OF SAFETY

(SALES) - [BREAK EVEN OF 0 = (U CM)(Q) - FIXED]

4

FORMULA: MARGIN OF SAFETY PERCENTAGE

MARGIN OF SAFETY / SALES

5

FORMULA: DEGREE OF OPERATING LEVERAGE

CM / NET OP INC

6

FORMULA: ESTIMATE IMPACT OF NET OP INC CHANGE

(DEGREE OF OP LEVERAGE) (% CHANGE)

7

FORMULA: % CHANGE IN NET OP INC

(CHANGE IN NET OP INC) / (ORIGINAL NET OP INC)

8

FORMULA: HIGH/LOW VARIABLE COST

(COST CHANGE) / (ACTIVITY CHANGE)

9

FORMULA: HIGH/LOW FIXED COST

(HIGHEST COST) - [(HIGHEST ACTIVITY) (VARIABLE COST)]