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Analysis of Cost, Volume, and Pricing to Increase Profitability





1. Use the contribution margin per unit approach to calculate the sales volume required to break even or earn a target profit.

2. Set selling prices by using cost-plus, prestige, and target pricing.

3. Use the contribution margin per unit to conduct cost-volume-profit analysis.

4. Draw and interpret a cost-volume-profit graph.

5. Calculate margin of safety.

6. Conduct sensitivity analysis for cost-volume-profit relationships.

7. Use the contribution margin ratio and the equation method to conduct cost-volume-profit analysis.

8. Perform multiple-product break-even analysis (Appendix).





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