Profit-Volume Graph: Identification and Sensitivity Analysis (LO3)

A typical profit-volume graph follows.

Required

a. Identify each of the following:
1. Area BDC 2, Area DEF 3. Point D 4. Line AC 5. Line BC 6. Line HF

b. Indicate the effect of each of the following on line CF and the break-even point:
1. An increase in the unit selling price 2. An increase in the variable costs per unit 3. A decrease in fixed costs 4. An increase in fixed costs and a decrease in the unit selling price 5. A decrease in fixed costs and an increase in the variable costs per unit (p. 79)

Transcribed Image Text:

A LL F B E D C