COST ACCOUNTING
COST VOLUME PROFIT ANALYSIS
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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break-even point
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point of profit
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point of desired sales
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point of total sale
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Detailed explanation-1: -The sales line will cut the total cost line at a point where the total costs are equal to total revenues and this point of intersection ox’ two lines is known as breakeven point-the point of no profit no loss.
Detailed explanation-2: -Break-even point: It is the point of intersection of the total cost line and total revenue line.
Detailed explanation-3: -A breakeven chart is a chart that shows the sales volume level at which total costs equal sales. Losses will be incurred below this point, and profits will be earned above this point.
Detailed explanation-4: -Profit earned following your break even: Once your sales equal your fixed and variable costs, you have reached the break-even point, and the company will report a net profit or loss of $0. Any sales beyond that point contribute to your net profit.
Detailed explanation-5: -The breakeven point is indicated by the Intersection of the total cost line and the sales line.