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2009•Annals of the University of Petroşani. EconomicsOpen access

USING COST-VOLUME-PROFIT ANALYSIS IN DECISION MAKING

Dina Ionela-Claudia, Gabriela Buşan

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Abstract

The cost-volume-profit study the manner how evolve the total revenues,the total costs and operating profit, as changes occur in volume production, sale price, the unitvariable cost and / or fixed costs of a product. Managers use this analysis to answer differentquestions like: How will incomes and costs be affected if we still sell 1.000 units? But if youexpand or reduce selling prices? If we expand our business in foreign markets?

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The cost-volume-profit study the manner how evolve the total revenues,the total costs and operating profit, as changes occur in volume production, sale price, the unitvariable cost and / or fixed costs of a product. Managers use this analysis to answer differentquestions like: How will incomes and costs be affected if we still sell 1.000 units? But if youexpand or reduce selling prices? If we expand our business in foreign markets?

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Available abstract

The cost-volume-profit study the manner how evolve the total revenues,the total costs and operating profit, as changes occur in volume production, sale price, the unitvariable cost and / or fixed costs of a product. Managers use this analysis to answer differentquestions like: How will incomes and costs be affected if we still sell 1.000 units? But if youexpand or reduce selling prices? If we expand our business in foreign markets?

Key concepts: Variable cost, Fixed cost, Profit (economics), Revenue, Business, Industrial organization, Net profit, Unit price

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