1- Topic: Cost-Volume-Profit Analysis 2- Please use the following format: a- Cover page b- List of tables (if any) c- List of exhibits (if any) d- Executive summary e- Introduction f- Topic...

Running Head: COST VOLUME PROFIT ANALYSIS                    1
COST VOLUME PROFIT ANALYSIS         9
COST VOLUME PROFIT ANALYSIS
Table of Contents
Executive Summary    3
Introduction    4
Topic Statement    4
Literature Review    6
Analysis    8
Conclusion and Recommendations    9
References    11
Executive Summary
The report describes about the Cost Volume Profit Analysis. The whole report divided into five parts. Starting from the introduction of the cost volume profit, the tool usually uses to know the impact of the varying level of cost and volume to have an operating cost. The second part is the detailed explanation of the topic. With the help of literature review, a systematic review has done to gain the knowledge of the cost volume profit and its managerial advantage. The recommendation and conclusion parts prove that why Cost-Volume-Profit Analysis is a beneficial management tool for decision making in small business.
Introduction
The term cost profit analysis used as tool in cost accounting. The tool usually uses to know the impact of the varying level of cost and volume to have an operating cost. This analysis tool is also known as
eak-even analysis. The
eak-even point can be analyzed as a point where the revenue is equal to the cost structure of the firm. The tool used by various managers for different sales volume and cost structure in a firm. The formula of the cost volume analysis determine by fixed cost divided by contribution margin.
This contribution margin can further explain as the difference of sales and variable cost. As mentioned by Simon, Septiana and Suci (2020), the contribution margin set up to explain about the
eak-even point of the sales. In addition to it, if the amount of the fixed cost divided by the contribution margin. The amount of the
eak-even point can be in dollars. It is an effective way to know how much changes in both costs (variable cost and the fixed cost) can actually influence the profitability of the firm. The business also uses this formula to know how many units need to be in the
eak-even and also in minimum profitability margin.
Topic Statement
The cost volume analysis seems to be represented as marginal costing; it studies the relationship between cost, volume and profits. The management of the firm use the inter relation of these three aspect to make any important decision. The tool tells the relationship between the cost revenue with respect to the volume. It indicates the equili
ium level where the cost and revenue of the firm is same, also called as
eak-even point.
It is a no profit and no loss zone for the company. As mentioned by Armean and Ardeleanu (2017), many business owners faces problem using this method in case of substitute material and reduced demand of the product. Whatever is the case of the company this tool proved as a vital tool to analyses the position of the firm with respect to the changes introduced. In addition, with the above issues, there are also some problems faced by business in time of economic depression and selling of the product below the cost.
The planning control and control becomes difficult to manage and it is hard to predict the changes in the general patter due to external factors and competition. In order to solve the above problem, cost profit analysis is one of the most effective tools of the cost accounting. It duly helps the business owners to plan the profit, controlling of the cost and to facilitate better decision-making process in the firm.
The study “cost volume profit” is tool for management to suggest that how the application of the cost volume profit going to suggest the manager for better decision-making process and boast profitability. As stated by Le, Tran, Tran and Nguyen (2020), the analysis process will help the manager to utilize the available resources to the best level, certainly, with minimum waste. It will help in achieving the goal of the profit maximization. It acts as an alarm telling the manager about the shortage of the fund and requirement to buy raw material.
The cost volume analysis advances the state of competition where all the firms have to survive for the fittest. The tools also help in fighting low cost utilization issue in the firm. It is believe while doing the report that manager will count only this analysis...