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Name the definitions given below: ______________ 1. Technique that examines chan

ID: 2424573 • Letter: N

Question

Name the definitions given below:

______________

1.

Technique that examines changes in profits in response to changes in sales volumes, costs, and prices.

______________

2.

Percent by which the selling price (or revenue) per unit exceeds the variable cost per unit, or contribution margin as a percent of revenue.

______________

3.

Diagram of the relationship between total revenues and total costs; illustrates how an organization’s profits are expected to change under different volumes of activity.

______________

4.

Index of the extent to which the cost function is made up of fixed costs.

______________

5.

Total revenue minus total variable costs.

______________

6.

Proportion of different products or services that an organization sells.

______________

7.

Excess of an organization’s expected future sales (in either revenue or units) above the breakeven point.

______________

8.

The level of activity where equal cost or profit occurs across multiple alternatives.

______________

9.

Selling price per unit minus variable cost per unit.

______________ 10.

Level of operating activity at which revenues cover all fixed and variable costs and there is no profit.

______________ 11.

Margin of safety as a percentage of actual or estimated sales (units or revenues).

______________ 12.

A systematic tendency for people to be overly optimistic about the outcomes of their plans and projects.

______________

1.

Technique that examines changes in profits in response to changes in sales volumes, costs, and prices.

______________

2.

Percent by which the selling price (or revenue) per unit exceeds the variable cost per unit, or contribution margin as a percent of revenue.

______________

3.

Diagram of the relationship between total revenues and total costs; illustrates how an organization’s profits are expected to change under different volumes of activity.

______________

4.

Index of the extent to which the cost function is made up of fixed costs.

______________

5.

Total revenue minus total variable costs.

______________

6.

Proportion of different products or services that an organization sells.

______________

7.

Excess of an organization’s expected future sales (in either revenue or units) above the breakeven point.

______________

8.

The level of activity where equal cost or profit occurs across multiple alternatives.

______________

9.

Selling price per unit minus variable cost per unit.

______________ 10.

Level of operating activity at which revenues cover all fixed and variable costs and there is no profit.

______________ 11.

Margin of safety as a percentage of actual or estimated sales (units or revenues).

______________ 12.

A systematic tendency for people to be overly optimistic about the outcomes of their plans and projects.

Explanation / Answer

__CVP Analysis____________

1.

Technique that examines changes in profits in response to changes in sales volumes, costs, and prices.

__Contribution Margin Ratio (%)____________

2.

Percent by which the selling price (or revenue) per unit exceeds the variable cost per unit, or contribution margin as a percent of revenue.

___CVP Graph___________

3.

Diagram of the relationship between total revenues and total costs; illustrates how an organization’s profits are expected to change under different volumes of activity.

_____Degree of Operating Leverage_________

4.

Index of the extent to which the cost function is made up of fixed costs.

__Contribution Margin ____________

5.

Total revenue minus total variable costs.

_Product Mix_____________

6.

Proportion of different products or services that an organization sells.

__Margin of safety____________

7.

Excess of an organization’s expected future sales (in either revenue or units) above the breakeven point.

_Point of Indifference_____________

8.

The level of activity where equal cost or profit occurs across multiple alternatives.

____Unit Contribution Margin__________

9.

Selling price per unit minus variable cost per unit.

_______Break Even Sales _______ 10.

Level of operating activity at which revenues cover all fixed and variable costs and there is no profit.

_______Margin of safety %_______ 11.

Margin of safety as a percentage of actual or estimated sales (units or revenues).

_Optimism Bias_____________ 12.

A systematic tendency for people to be overly optimistic about the outcomes of their plans and projects.

__CVP Analysis____________

1.

Technique that examines changes in profits in response to changes in sales volumes, costs, and prices.

__Contribution Margin Ratio (%)____________

2.

Percent by which the selling price (or revenue) per unit exceeds the variable cost per unit, or contribution margin as a percent of revenue.

___CVP Graph___________

3.

Diagram of the relationship between total revenues and total costs; illustrates how an organization’s profits are expected to change under different volumes of activity.

_____Degree of Operating Leverage_________

4.

Index of the extent to which the cost function is made up of fixed costs.

__Contribution Margin ____________

5.

Total revenue minus total variable costs.

_Product Mix_____________

6.

Proportion of different products or services that an organization sells.

__Margin of safety____________

7.

Excess of an organization’s expected future sales (in either revenue or units) above the breakeven point.

_Point of Indifference_____________

8.

The level of activity where equal cost or profit occurs across multiple alternatives.

____Unit Contribution Margin__________

9.

Selling price per unit minus variable cost per unit.

_______Break Even Sales _______ 10.

Level of operating activity at which revenues cover all fixed and variable costs and there is no profit.

_______Margin of safety %_______ 11.

Margin of safety as a percentage of actual or estimated sales (units or revenues).

_Optimism Bias_____________ 12.

A systematic tendency for people to be overly optimistic about the outcomes of their plans and projects.