Financial accounting statements are prepared for the benefit of those outside the company.
Are you profitable?
Do you collect your “net profit”?
What are you worth?
Do you collect your “net worth”?
Cost-Volume-Profit (CVP) Analysis
Managers must make decisions about sales volume, pricing and costs and are concerned about the impact of their decisions on profit. Therefore, they need to understand the relations among revenues, costs, volume and profit. Cost-volume-profit, or CVP, analysis provides managers with information for decision making.
What is CVP?
CVP analysis explores the relationship between sales revenue, cost and their effect on profits. Also known as Break-even analysis