CVP equation

CVP equation:
px = vx + FC + Profit
p is the price per unit,
x is the number of units,
v is variable cost per unit and
FC is total fixed cost.

Target Profit Analysis

Definition and Explanation of Target Profit: Target profit is the amount of net operating income or profit that management desires to achieve at the end of a business period. Management needs to know the required level of business activities to get target profits. Cost