Analysis of the ratio of costs, volume of production and profit (CVP-analysis). Determination of the critical volume of sales Determine the critical volume of output

Critical sales volume, pcs

Threshold of profitability, rub

Margin of financial strength, rub

The critical volume of product sales Qkr is such a sales volume at which profit is zero and is determined from the condition VP=RP -Stot =0

According to the formula: ,

where Ipost - fixed production costs for output;

Iper - variable production costs per unit of production.cr \u003d 5435880 / (38694.7-29526.3) \u003d 593 pieces.

Profitability threshold, rub - this is the proceeds from the sale, at which the company no longer has losses, but still does not receive profit.

Prent \u003d Qkr * Tsotp

The margin of financial safety is the amount by which the company can afford to reduce revenue without leaving the profit zone.

By the value of the relative indicator of the financial safety margin, one can judge the entrepreneurial risk of receiving a loss. The higher the positive value of this indicator, the lower the entrepreneurial risk. Entrepreneurial risk in the region of the zero value of the indicator corresponding to the critical point becomes large

In relative terms, the financial safety margin is defined as:

The strength of operating leverage (COP is determined by the ratio of gross margin (VM) and gross profit (GR)

VM=RP-Iper.

This indicator is more adapted to serve as a measure of entrepreneurial risk. Its value as the actual volume of sales of products approaches the break-even point increases very quickly.

Calculations to assess the change in these indicators with the full and estimated use of production capacity, as well as with a critical volume of production (break-even point) should be presented in Table. 8-R

Calculate gross revenue at actual production volume, at full capacity utilization and at critical production volume

RP Qact. = 46571.8 * 1999 = 93097028 rubles.

RP Qfull.PM \u003d 46571.8 * 2298 \u003d 107021996 rubles.

RP Qcrit. \u003d 46571.8 * 593 \u003d 27617077 rubles.

Calculate gross costs at actual production volume, at full capacity utilization and at critical production volume

And a shaft. Qfact = 32245.6 * 1999 = 64458954 rubles.

And a shaft. Qfull PM \u003d 32245.6 * 2298 \u003d 74100389 rubles.

And a shaft. Qcrit \u003d 32245.6 * 593 \u003d 19121641 rubles.

Calculate fixed costs at actual production volume, at full capacity utilization and at critical production volume

And pos. Qfact \u003d 2719.3 * 1999 \u003d 5435881 rubles.

And pos. Qfull PM \u003d 2719.3 * 2298 \u003d 6248951 rubles.

And pos. Qcrit \u003d 2719.3 * 593 \u003d 1612545 rubles.

Calculate variable costs at actual production volume, at full capacity utilization and at critical production volume

And trans. Qfact \u003d 29526.3 * 1999 \u003d 59023074 rubles.

And trans. Qfull PM \u003d 29526.3 * 2298 \u003d 67851437 rubles.

Volume of production at the break-even point (the critical volume of production) is the volume at which the company does not make a profit, but does not incur losses.
The critical volume (Qcr) is expressed in physical units (pieces).
Critical revenue (S cr) is the value expression of the critical volume.
Using the analysis of values ​​in the break-even point, you can determine the critical value that shows when revenue covers the total costs of the enterprise. Analysis of break-even points provides managers at all levels with information for better decision making in the future. With the help of this analysis, you can better assess the opportunities for profit. Graphical interpretation of the break-even model Break-even chart:
FS - fixed costs; VC - variable costs; FC+VC - total costs; S - revenue; Qxp - critical volume; Q - volume of production in physical terms Calculation of revenue at the break-even point Analytical representation of the model under consideration is based on the following basic formula:
S = FC + VC + GI, where GI is profit. Since there is a relationship between cost and natural volumes, expressed by the ratio S = p Q, where p is the price per unit of production, the above formula can be represented as follows: p Q = FC + v Q + GI,
where v - variable costs per unit of output.
Transforming the formula, we get Q ¦ (p - v) \u003d FC + GI
To find the critical volume, we set the condition GI = 0. Based on this, we obtain the formula: Qkp = FC / (р - v)
The denominator of the fraction (p - v) is called the specific coverage amount, and accordingly, S - VC, will be called the coverage amount. The critical revenue, taking into account the relationship between S and Q, can be found by the formula: Skp = p
Critical revenue can also be found using another formula, which is advisable to use if the price of the product is unknown in the condition: Skp = FC /

Breakeven (critical) volume can be calculated in several ways.

1. The minimum volume of output in physical terms:

Qmin = CF / p - CV

2. To calculate the volume of output in value terms, the left and right parts of the expression are multiplied by the price (rubles).

p*Q=CF+CV*Q

where Q * p \u003d N - sales proceeds (taken without VAT).

3. Critical sales volume can be calculated using marginal revenue. Marginal income MD is defined as the difference between revenue and variable costs:

Then Nmin = CF / MD

The calculation of the break-even point is not difficult, provided that the company produces one product. If the company produces only one product, then this eliminates the need to allocate fixed costs to many manufactured products.

The given graphical dependence of costs, profits and sales volume allows us to draw important conclusions for the enterprise:

1. An enterprise can make a profit (revenue minus fixed and variable costs) only if it sells products of a larger volume than the critical point A.

2. Point A , , is called the critical point, at the transition through which all costs are paid off and the enterprise begins to make a profit.

3. The point of intersection of the curve of fixed costs and the curve of marginal income shows the volume of production, after which the payback of fixed costs occurs.

4. With an increase in prices for manufactured products, the minimum volume of production, which corresponds to the critical point, decreases, and with a decrease in price, it increases.

5. With an increase in fixed costs, the minimum production volume corresponding to the break-even point increases.

6. Maintaining a break-even volume of production with an increase in variable costs is possible, other things being equal, by increasing the minimum volume of production.

To determine the break-even production of products consider the relationship between revenue, profit, variables and fixed costs.

Total cost of production divided by fixed(VOSTZ) and variable costs (PERZ), can be represented as an equation:

Or (3.6.)

where p1 - ​​variable costs per unit of product; K is the volume of production.

Sales revenue is determined by the ratio:

, (3.7.)

where C is the unit price of the product.

Then the relationship between profit, revenue, constant and variable costs is characterized by the ratio:

Or (3.8.)

Let us evaluate the impact of revenue and costs on profit based on the assumption that the profit of the enterprise should be non-negative, i.e. PRP > About

If the profit of the enterprise is equal to zero: PRP \u003d O, then in this case the revenue of the enterprise is equal to the costs, i.e. before acceptance has zero profit: VPP = O, V = ZAT.

The main indicators characterizing this situation are:

1. Specific contribution margin

2 . Critical production volume

3. Production safety margin, production strength range, production strength level

4. Marginal profit

5. Critical revenue

6. Margin of financial strength

7. Range of financial strength

8. Level of financial strength

Specific marginal profit.

Difference between unit price and variables for costs of its production is called marginal profit per unit of output or specific marginal profit

(3.9.)

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Critical production volume.

The volume of production and sales at which the enterprise has zero profit, is called critical - Kkr (break-even point).

The value of the critical production volume (Kcr) is determined is obtained from the ratio:

(3.10.)

With an increase in the critical volume, the profit decreases. acceptance. The main factors affecting the value of criti cal volume of production are:

An increase in fixed costs leading to an increase the critical volume of production, respectively, with a decrease in fixed costs, the critical volume of production decreases;

An increase in variable costs per unit of output when constant price, leading to an increase in the critical volume of production, respectively, with a decrease in variable costs per unit of production, the critical volume of production decreases stva;

increase in selling price with constant variables costs per unit of output, leading to a decrease in critical cal volume of production.

Obviously, the critical volume of production is decreasing if the growth rate of fixed costs is less than the growth rate increase in marginal income per unit of output.

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Production safety margin.

Difference between actual (Kfact) and critical volume production (Kcr) characterizes the margin of safety of production in in kind (ZPR):

(3.11.)

If Kfact > Kkr, then the enterprise makes a profit from the production and sale of products, if the value of the ZPR is negative, then the enterprise from the production and sale of these products has losses.

When Kfact > Kcr, you can set the range of production strength - DPP and the level of industrial safety U (ZPP):

(3.12.)

(3.13.)

The larger the value of Uprb, the more efficient production and sales this product.

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Marginal profit.

The difference between sales revenue and variable costs called marginal profit (MPR). This is the part of the gain ki from the sale of products that remain to cover the permanent fixed costs and profit generation:

(3.14.)

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Critical revenue.

Critical revenue (or profitability threshold) (Vcr),

Ministry of Education and Science of the Russian Federation

State educational institution of higher professional education

St. Petersburg State Forest Engineering Academy

named after S.M. Kirov

Faculty of Economics and Management

Department of Forest Policy, Economics and Management

Control work on the discipline "Economics of the forest sector"

Completed by a student of FEU, 2nd year, c / o, usk.

Specialty No. 080502

Record book number 69103

Checked:

St. Petersburg

2010-2011
Table of contents

Task 2. 3

Task 3.4

Task 5.5

Task 6.6

Task 7. 7

Problem 8. 8

Task 9. 9

Task 10.9

Problem 11. 10

Problem 12. 11

Problem 13. 12

References.. 14

Task 2.

To increase the efficiency and sustainability of the industry, it is planned to increase the volume of production by 20%. The actual volume is 200 thousand units, the price of a C unit is 700 rubles, the unit cost is 580 rubles, incl. fixed costs - 40%.

Required

1. Determine the critical volume of production Q cr.

2. Find the change in profit.

3. Compare the percentage change in volume and profit; explain the reason for their ambiguous percentages.

The critical production volume is calculated by the formula

Q cr \u003d 3 P0S / C-3 st lane

where 3 st lane - variable costs per unit; 3 П0С - fixed costs for volume, rub.

200 * 700 \u003d 140,000 thousand rubles. (revenue)

200 * 580 = 116,000 thousand rubles (total costs)

116000 * 0.4 \u003d 46400 thousand rubles. (permanent)

116000 * 0.6 \u003d 69600 thousand rubles. (variables)

140000 - 116000 = 24000 thousand rubles (profit)

Qcr \u003d 46400 / 700 - 348 \u003d 131.818 thousand units.

220 * 700 \u003d 154,000 thousand rubles. (revenue)

220 * 348 = 76560 thousand rubles. (variables)

46400 + 76560 - 154000 = 31040 thousand rubles. (profit)

The volume of production increased by 9.1%, and profit by 22.7%. They are not unambiguous, because with an increase in production, fixed costs in the total share decrease.

Task 3

Using the marginal characteristics (marginal cost - I p, marginal income - D p), establish the feasibility of increasing production by 20% under the following conditions:

Production volume - 100 thousand units,

The actual price is 700 rubles,

It is planned to increase the actual price by 5%,

The actual cost is 580 rubles, including fixed costs - 230 rubles.

The following expression testifies to the expediency of increasing the volume of production: And p is less than or equal to D p

Marginal cost is calculated using the formula

And n \u003d And 2 - And 1 / Q 2 - Q 1 \u003d delta I / delta Q

And n \u003d 65000 - 58000 / 120 - 100 \u003d delta 7000 / delta 20 \u003d 350

Marginal revenue is calculated using the formula

D p \u003d D 2 - D 1 / Q 2 - Q 1 \u003d delta D / delta Q

D p \u003d 88200 - 70000 / 120 - 100 \u003d delta 18200 / delta 20 \u003d 910

910 (I p) less than or equal to 350 (D p)

It is advisable to increase the volume of production.

Task 4

The processing industry of the district plans to use the waste. The volume of raw materials is 50 thousand units, the price of a unit of raw materials is 800 rubles, the yield of products from raw materials is 50%. Waste is expected to be sold at a price of 300 rubles. for a unit. Waste disposal costs - 80% of their price. The share of useful waste is 40% of the volume of raw materials. Useful marketable waste reduces the cost of the main products.

How much will the industry profit from using waste?

50 - 50% \u003d 25 thousand units - output.

25 * 800 = 20,000 thousand rubles - the cost of production.

50 * 0.4 = 20 thousand units - useful waste.

20 * 300 \u003d 6000 thousand rubles. - cost of waste.

6000 * 0.8 = 4800 thousand rubles waste sales costs.

6000 - 4800 \u003d 1200 thousand rubles. profit from waste.

Profit will increase by 1200 thousand rubles. Or 6%.

Task 5

The cost of production is 400 rubles, incl.

Remuneration - 120 rubles, of which the remuneration of managers - 50%,

Depreciation - 60 rubles,

Material costs - 160 rubles,

Others - 60 rubles, of which fixed costs - 50%. The planned production volume is 10 thousand units. Required

1. Establish an economic and mathematical relationship between the cost of production and the volume of production.

2. Find the critical volume of production.

3. Determine the zone of financial stability.

200 thousand rubles - fixed costs.

200 thousand rubles - variable costs.

C \u003d a * Q + b \u003d 0.02 * 10 thousand units. + 200 = 400 thousand rubles.

C beats \u003d a + b / Q \u003d 400 / 10 thousand units. = 0.04 rub.

400 * 1.2 \u003d 480 - revenue.

480 rub. / 10 thousand units = 0.048 rub. – unit price.

200 / 0.048 - 0.02 = 7143 units - critical volume of production.

10000 - 7143 = 2857 units – zone of financial stability.

480 - 343 / 480 \u003d 0.29 or 29% - the zone of financial stability.

Task 6

In 2006, the profitability of the products of the industry processing raw materials by mechanical means amounted to 15.3%.

The profitability of the products of the industry that processes raw materials by chemical means in the same year was 32.4%.

What is the level of profitability of the products of the logging industry, all other things being equal?

The profitability of the products of the logging industry, most likely, should be positive, since the profitability of the products of the industry that processes raw materials is quite good (they form a chain). The profitability of the products of the logging industry in 2000 was 4.6%, and in 2003. – 1.3%. It often happens that Russia escorts unprocessed wood, and returns products of deep processing, the cost of which is 12-15 times higher than the cost of raw materials. Therefore, we can conclude that the level of profitability of the products of the logging industry is not as high as compared to the processing industry.

Task 7

Determine the effect of increasing the level of technical and technological equipment of production in the industry based on the information below.

Production volume - 200 thousand units.

Actual labor productivity - 500 units per year. It is planned to increase labor productivity by 30%. The actual level of the annual wages of a worker is 160 thousand rubles. The increase in the worker's wages is accepted by the student independently according to the theory of outstripping growth of labor productivity in comparison with wages.

The effect of increasing the level of technical and technological equipment of production E is determined by the formula

E \u003d Q * (Z e bases - Z e pl), where Z e bases, Z e pl - respectively, the basic and planned wages per unit of output.

200000 / 500 = 400 - workers

400 * 160 = 64000 - salary

500 * 1.3 = 650 - increased labor productivity by 30%.

650 * 400 = 260000 - production volume

The annual salary of a worker is 184 thousand rubles. (+24 thousand rubles or 15%).

Task8

The production program of the industry is 60% lower than the production capacity. Demand for the industry's products is not being met.

Specify the reasons for underutilization of production capacity. How long can the industry pursue such a policy without experiencing financial difficulties? What is the pricing policy of the industry?

The reasons for the underutilization of production capacity are that the enterprise was created with the expectation of a higher production volume and demand for these products. Questions arise whether the enterprise is profitable or not, how much the downtime costs and what is the profitability of unloaded capacity. If this is short-term downtime or seasonality, then it is possible

The essence of calculating the break-even point is to analyze the interaction of supply and demand for a particular product of the company. In the process of analysis, the break-even point is determined, corresponding to the volume of production at which the income from the sale is equal to the production costs. The calculation of the critical volume of production is based on the accounting of costs according to the "direct costing" system, while the cost of production is taken into account and planned only in terms of variable costs. Fixed costs are deducted from income generated during that period. Financial results are evaluated by two indicators: marginal income and profit. Marginal income is the sum of profit and fixed costs, i.e.

MD \u003d P + Zpost \u003d Vp - Zper, (1.22)

Hence, profit is defined as:

P \u003d MD - Zpost \u003d Vr - Zpost - Zper, (1.23)

where MD - marginal income;

VR - revenues from sales;

Zper - variable expenses;

Zpost - fixed costs;

Etc - profit from product sales.

The division of expenses into variable and fixed, as well as the procedure for the formation of marginal income, allows us to establish a functional relationship between profit, volume and cost of the produced (sold) product. Such a dependence is clearly shown in the graph in Fig. 1. Based on the presented dependence, the critical production volume of the corresponding product can be calculated:

where - unit price, rub.;

З i lane - variable costs per unit of output, rub.

The graphical approach to determining the break-even point is based on the so-called break-even chart (Fig. 1.1.)

The graphical approach to determining the break-even point is based on the so-called break-even diagram (Fig. 1.2.)

Figure 1 - The relationship between cost, production and profit

In the course work, the calculation of the critical volume of production is recommended in accordance with table 2.1. Based on the data obtained in the table, a graph of the interdependence of production volume, cost and profit should be built.

Table 2.2. - Calculation of the critical volume of production.

Thus, the essence of the break-even point is that it represents the minimum volume of output, selling which the firm will remain with zero profit, but will cover the costs.

2.3. Evaluation of the company's performance

Evaluation of the results of the company's activities is given on the basis of the main effective financial indicators. These include profit, tk. it is the main source of economic, technical and social development of the firm. It is an absolute indicator formed after reimbursement of costs for production and sale of products. The final financial result of the company's activities is reflected in the part of the profit that remains at its disposal as an internal source of long-term financing. This figure is called net income.

Gross profit is determined by the formula:

, (1.25)

where AT- proceeds (gross income) from the sale of products, rub.

revenue (gross income) from the sale of products is calculated by the formula:

B \u003d C opt N B,(1.26)

Calculations of financial results should be given in table 2.3.

Table 2.3 - Calculation of the financial result of activities (butter sausages)

Table 2.3 - Calculation of the financial result of activities (meat bread)

where AT - proceeds from the sale of products (works, services);

WITH - cost of goods sold (works, services);

Etc - profit from the sale of products (performance of work, provision of services);

Pv - gross profit;

Doh - income from participation in other organizations;

Roh - administrative (general) expenses of the enterprise;

Rk - commercial expenses of the enterprise;

Mon - profit before tax;

PNO - permanent tax liabilities;

PC - net profit of the enterprise.

When calculating the financial results of the enterprise, it is necessary to take into account:

1. Sales proceeds are indicated in Table 2.3 minus value added tax.

2. Commercial expenses are determined based on the sum of products of commercial expenses per unit of production (table 1.8) and the volume of products sold.

3. Management expenses are determined based on the sum of the products of management (general) expenses per unit of output (table 1.7) and the volume of products sold.

4. The cost of production is calculated as the sum of the products of the cost of each product and the volume of sales, minus management and commercial expenses.

5. Other indicators are determined based on Appendix 7.

As a term paper condition, permanent tax liability is 175% of income tax.

Profitability characterizes the efficiency of the enterprise's production activities for a certain period of time.

Profitability of sales determines the level of current efficiency in the use of enterprise resources.

The coverage ratio shows the extent to which the company's short-term debt is covered by its current assets.

The value of non-profitable turnover corresponds to such a sales volume at which the value of the enterprise's profit is zero.

Calculation of all listed indicators to make in table 2.4.

Table 2.4 - Calculation of production performance indicators (creamy sausages).

Table 2.4 - Calculation of production performance indicators (meat loaves).

Based on the results of the calculation of production performance indicators and the calculation of profitability indicators, it is necessary to draw conclusions and give recommendations for improving the efficiency of the company.

From the calculations, according to the course work, it was found that, in general, the implementation of the project for the production of creamy sausages and meat loaves is economically feasible and this enterprise could expand its range of products and increase its output. In order to improve production efficiency, it is necessary to install new equipment, increase the output of these products, improve the skills of personnel and improve the quality of goods.

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Appendix 1

Assortment and consumption rates of the main and auxiliary raw materials for the production of sausages