# Shared Flashcard Set

## Details

Chapter 5
Intro.to Man. Accounting 15th ed.
17
Accounting
02/03/2015

Term
 cost-volume-profit (CVP) graph
Definition
 A graphical representation of the relationships between an organization’s revenues, costs, and profits on the one hand and its sales volume on the other hand. (p. 192)
Term
 Contribution margin
Definition
 amount remaining from sales revenue after variable expenses have been deducted
Term
 break-even point
Definition
 he level of sales at which profit is zero. (p. 190)
Term
 Sales(equation)
Definition
 Price per unit X Quantity sold(P x Q)
Term
 Variable expenses (equation)
Definition
 Variable expenses per unit X quantity sold
Term
 Profit (equation)
Definition
 (P x Q - V X Q) - Fixed expenses
Term
 Unit CM (equation)
Definition
 Price per unit - Variable expenses per unit(P - V)
Term
 CVP graph is also called
Definition
 break-even chart
Term
 Contribution margin ratio (CM ratio)
Definition
 A ratio computed by dividing contribution margin by dollar sales. (p. 195)
Term
 Variable expense ratio
Definition
 A ratio computed by dividing variable expenses by dollar sales. (p. 196)
Term
 Incremental analysis
Definition
 analytical approach that focuses only on those costs and revenues that change as a result of a decision. (p. 198)
Term
 Unit sales the Break Even (equation)
Definition
 Fixed expenses / Unit CM
Term
 Target profit analysis
Definition
 Estimating what sales volume is needed to achieve a specific target profit. (p. 202)
Term
 Job cost sheet
Definition
 A form that records the materials, labor, and manufacturing overhead costs charged to a job. (p. 86)
Term
 Allocation base
Definition
 A measure of activity such as direct labor-hours or machine-hours that is used to assign costs to cost objects. (p. 89)
Term