Assignment 2: Analyzing Profitability and Other Variables

Sep 9th, 2015
KateS
Category:
Accounting
Price: $30 USD

Question description

Assignment 2: Analyzing Profitability and Other Variables

Cost-volume-profit analysis is an extension of break-even analysis. CVP analysis enables managers to understand cost behavior and the effect on profits in response to a wide variety of influences, such as changes in volume, variable and fixed costs, and price. This helps management make appropriate business decisions. For example, CVP analysis helps management identify a break-even point if volume or costs change or determine the volume necessary for a targeted profit level. CVP analysis can also help management develop a pricing strategy by projecting the effects the different price structures will have on costs and profits.

In this assignment, you will examine how you can use CVP analysis to plan and make various business decisions. In addition, you will analyze financial data of Compnet’s potential product acquisition (Prime Component) and determine the effects on profit due to variations in its costs and sales price.

Part II: Performing CVP Analysis

Continuing with the same scenario as in previous assignments for Compnet, complete the following:

  • Create a 4 page paper that includes the above calculations and analyzes the decision options.
  • Create a one-page memo for your senior management that summarizes your findings and provides recommendations. 

Review standard office memo templates available on the internet and create the one-page memo in Microsoft Word considering the audience to whom this information needs to be presented.

Apply APA standards to citation of sources. 


Tutor Answer

(Top Tutor) Daniel C.
(997)
School: Purdue University
PREMIUM TUTOR

Studypool has helped 1,244,100 students

Summary
Quality
Communication
On Time
Value
Five Star Tutor
Feb 13th, 2017
" Outstanding Job!!!! "
Ask your homework questions. Receive quality answers!

Type your question here (or upload an image)

1821 tutors are online

Brown University





1271 Tutors

California Institute of Technology




2131 Tutors

Carnegie Mellon University




982 Tutors

Columbia University





1256 Tutors

Dartmouth University





2113 Tutors

Emory University





2279 Tutors

Harvard University





599 Tutors

Massachusetts Institute of Technology



2319 Tutors

New York University





1645 Tutors

Notre Dam University





1911 Tutors

Oklahoma University





2122 Tutors

Pennsylvania State University





932 Tutors

Princeton University





1211 Tutors

Stanford University





983 Tutors

University of California





1282 Tutors

Oxford University





123 Tutors

Yale University





2325 Tutors