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CVP Analysis

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › CVP Analysis

  • This topic has 1 reply, 2 voices, and was last updated 7 years ago by John Moffat.
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    Posts
  • February 4, 2018 at 1:50 am #434953
    gangsta1
    Member
    • Topics: 75
    • Replies: 10
    • ☆☆

    Sir in your lecture notes for cvp, example 6 part B. It says to calculate the average c/s ratio.
    We already calculated the individual c/s ratio in part a, cant we use these individual c/s ratios to calculate average c/s ratio as follows:

    (.25×4800) + (.125×4800) + (.379×12000)/ (4800+4800+12000)=29.39%

    February 5, 2018 at 12:07 pm #435240
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54726
    • ☆☆☆☆☆

    No. As I say in the lectures (and is written in the answers in the notes) you can take the weighted average, but you need to weight the CD ratios by the total revenues – then you will arrive at the same result).

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  • The topic ‘CVP Analysis’ is closed to new replies.

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