PPT-Cost-Volume-Profit Analysis: Additional Issues

6 Learning Objectives Apply basic CVP concepts 1 Explain the term sales mix and its effects on breakeven sales 2 Determine sales mix when a company has limited resources 3 Indicate how operating leverage affects profitability. These investigations are conducted under the authority of Section 20a6 of the Occupational Safety and Health Act of 1970 29 USC 669a6 which authorizes the Secretary of Health and Human Services following a written request from an employer and author Marginals. for linear functions. Break Even points. Supply and Demand Equilibrium. Applications with Linear Functions. Cost, Revenue, Profit, . Marginals. Cost: C(x) = variable costs + fixed costs. Revenue: R(x) = (price)(# sold). Profit Maximizing Assumptions. Firm: Technical unit that produces goods or services.. Entrepreneur (owner and manager) . Gains the firm’s profits and suffers losses and has the goal of maximizing profit.. Chapter 18. PowerPoint Editor:. Beth Kane, MBA, CPA. Copyright © 2016 McGraw-Hill Education.  All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.. for . gmat. cat. arpit. . http://www.freegregmatclass.com/. Manufacturer ( i.e. the producer). Wholesaler (dealer) Retailer (shopkeeper). Customer. SUBJECT. : . . ECONOMICS AND MANAGEMENT. DEPARTMENT :EC . SEM:3. rd. PREPARED BY: . PARIHAR SHIPRA A. (130500111012). PARMAR KINYARI P. (130500111013). PATEL DHARA H. (130500111014). GUIDED BY: . AP Economics. Mr. Bordelon. Profit. Profit.. . . T. otal revenue minus total cost. π means “profit.”. π = TR – TC. Total revenue.. Price of output times the quantity sold.. TR = PQ. Total cost.. Conducting a Profit Sensitivity Analysis to Identify volume Hurdles and the Challenges Inherent in Economic Price Optimization. Agenda. How do price changes influence the ability to capture customers?. Learning Objectives. Explain the purpose of cost-volume-profit (CVP) analysis. Explain the contribution margin (CM) concept. Compute the break-even (BE) point by using graph, equation, and contribution margin methods. Goal of Section. Overview what economists mean by Cost. (Economic) Cost Functions. Derivation of Cost Functions. Concept of Duality. What it all means. Economic Cost. Economic Cost: Value of what is given up whenever an exchange or transformation of resources takes place. Behind the Supply Curve. Profit . Profit = Total Revenue – Total Cost. Primary goal of a firm is to maximize profit. Can be done in two ways. Increase revenue. Reduce costs. What types of costs exist?. 1. This Photo. by Unknown Author is licensed under . CC BY-SA. Unrealised profit: Closing inventory. Reminder of the principle from FIAC6212. Example. P (parent) sold inventory to S (subsidiary) at cost plus 20%. . CHAPTER OBJECTIVES. Meaning of Cost-volume-profit analysis. . Objectives . of Cost-volume-profit . analysis. Assumptions of Cost-volume-profit analysis . T. echniques . or elements of Cost-volume-profit analysis.. Richard Roth, Randolph Kirchain, Elizabeth Moore. Materials System Laboratory. Massachusetts Institute of Technology. Presentation to International Seabed Authority. Open Ended Working Group on Financial Modeling.