Costs, Volumes and Profits Certification

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Costs, Volumes and Profits
The difference between business revenue and costs of operation make up business profits. Sales volumes and the cost of products or services can impact the potential of a business to generate profits. This relationship is explained through cost-volume-profit analysis.

The difference between sales and variable costs or the cost of goods and/or services sold makes up profits. After deducting fixed costs from the gross profit, you are left with income or the net profit. Fixed costs range from rent and interest to insurance and labour costs. They are indirectly related to production of goods and services.

Higher costs lead to lower profits and vice versa. Increasing revenue or lowering costs can increase profits. Improving the efficiency of business operations, reducing the cost of material and cutting on labour can reduce costs. The cuts on costs should not cause a drop in business revenue to increase profits.

If the sales volumes are higher than variable costs, more profits can be generated. Constant sales volume and revenue with reduced costs can increase profits. This course explains the relationship between costs, volumes and profits through cost-volume-profit analysis.

We show how changes in prices, margins and unit volumes of products or services can affect a company’s ability to generate profits. Cost-volume-profit or CVP analysis is a critical tool for financial analysis that helps businesses determine their ability to become profitable.

You Will Learn:

The definition of the terms: costs, volumes and profits

The relationship between costs, volumes and profits

How to calculate cost-volume-profit or CVP analysis

The assumptions made during CVP analysis

How to calculate contribution margin and contribution margin ratio

Pound and unit break-even points

How to create a contribution margin income statement

The benefits of CVP analysis

Benefits of the Course:

Taking this course will help you:
Know the relationship between cost, volume and profits

Know how to calculate CVP analysis

Know how to use analysis results to increase business profits

Know the importance of the relationship of cost, volume and profits in business operations

Know the various benefits of CVP analysis in business

Learn how to increase profits in your current or future business

There is no experience or previous qualifications required for enrolment on this course. It is available to all students, of all academic backgrounds.

The course does not require any pre-knowledge to pursue the course. And it is compatible with any kind of device. You will get the same experience in learning whether you are using Windows, Mac, a smartphone or tablet. You can access the course materials with any kind of connection, from anywhere, without any limitation!

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