Term
| cost-volume-profit (CVP) graph |
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Definition
| A graphical representation of the relationships between an organization’s revenues, costs, and profits on the one hand and its sales volume on the other hand. (p. 192) |
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Term
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Definition
| amount remaining from sales revenue after variable expenses have been deducted |
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Definition
| he level of sales at which profit is zero. (p. 190) |
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Term
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Definition
Price per unit X Quantity sold
(P x Q) |
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Term
| Variable expenses (equation) |
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Definition
| Variable expenses per unit X quantity sold |
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Term
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Definition
| (P x Q - V X Q) - Fixed expenses |
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Definition
Price per unit - Variable expenses per unit
(P - V) |
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Definition
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Term
| Contribution margin ratio (CM ratio) |
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Definition
| A ratio computed by dividing contribution margin by dollar sales. (p. 195) |
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Term
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Definition
| A ratio computed by dividing variable expenses by dollar sales. (p. 196) |
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Term
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Definition
| analytical approach that focuses only on those costs and revenues that change as a result of a decision. (p. 198) |
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Term
| Unit sales the Break Even (equation) |
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Definition
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Term
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Definition
| Estimating what sales volume is needed to achieve a specific target profit. (p. 202) |
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Term
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Definition
| A form that records the materials, labor, and manufacturing overhead costs charged to a job. (p. 86) |
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Term
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Definition
| A measure of activity such as direct labor-hours or machine-hours that is used to assign costs to cost objects. (p. 89) |
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Term
| Predetermined overhead rate |
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Definition
| A rate used to charge manufacturing overhead cost to jobs that is established in advance for each period. It is computed by dividing the estimated total manufacturing overhead cost for the period by the estimated total amount of the allocation base for the period. (p. 89) |
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