A CVP graph presents data on a company’s cost-volume-profit (CVP) relationship. This graph shows how changes in cost and volume affect the profitability of a business.
It shows the relationship between sales volume, costs, and profits for a given product or service. The graph helps businesses make important decisions about pricing, production levels, and other aspects of their operations.
Q1: How does a CVP graph help a business?
A1: A CVP graph helps a business by showing the relationship between sales volume, costs, and profits for a given product or service. It can be used to make important decisions about pricing, production levels, and other aspects of their operations.
Q2: What is the purpose of a CVP graph?
A2: The purpose of a CVP graph is to illustrate the cost-volume-profit (CVP) relationship of a business. It helps businesses understand how changes in costs and volume affect their profitability.
Q3: What is the relationship between sales volume, costs, and profits?
A3: The relationship between sales volume, costs, and profits is represented on a CVP graph to show how changes in cost and volume affect the profitability of a business.
Q4: What is the goal of a CVP graph?
A4: The goal of a CVP graph is to help businesses make informed decisions about pricing, production levels, and other aspects of their operations. It can help them understand the effect of changes in cost and volume on their profitability.
Q5: What type of data does a CVP graph present?
A5: A CVP graph presents data on a company’s cost-volume-profit (CVP) relationship. It shows the relationship between sales volume, costs, and profits for a given product or service.
