Chapter 19 Cost-Volume-Profit
Learning Objectives
After studying this chapter, you should be able to:
- Distinguish between variable and fixed costs.
- Explain the significance of the relevant range.
- Explain the concept of mixed costs.
- List the five components of cost-volume-profit analysis.
- Indicate what contribution margin is and how it can be expressed.
- Identify the three ways to determine the break-even point.
- Give the formulas for determining sales required to earn target net income.
- Define margin of safety, and give the formulas for computing it.
Feature Story
Don't Worry—Just Get Big
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