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Pembahasan 3

diadopsi dari:Garrison Noreen Brewer

Cost-Volume-ProfitRelationships

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Basics of Cost-Volume-Profit Analysis

Contribution Margin (CM) adalah sales revenuedikurang variable expenses.

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Basics of Cost-Volume-Profit Analysis

CM is digunakan untuk:1) memenuhi kebutuhan fixed expenses.

2) memberikan kontribusi terhadap kebutuhan laba operasiperusahaan (net operating income).

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The Contribution Approach

Sales, variable expenses, dan CM dapat disajikan per unit.Setiap terjual satu unit sepeda, maka diperoleh CM $200untuk memenuhi kebutuhan fixed expenses dan profit.

Berapa unit minimal yang harus terjual agar memenuhi kebutuhan

biaya tetap (fixed expenses)? Berapa kah Net income-nya?

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Untuk mencapai break even, maka setiapbulan Racing harus menghasilkan CM

$80,000 (sama dengan fixed exp.)

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Jika Racing menjual 400 units400 units dalam sebulan,maka perusahaan akan beroperasi pada

break-even point.

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Jika Racing menjual satu unit lagi (401 bikes401 bikes), makanet operating income will increase by $200.

Mengapa kenaikan CM sama dengan kenaikan NOI ? Apakahkenaikan sales atau kenaikan CM berpengaruh thd fixed exp. ?

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The Contribution ApproachTanpa menggunakan format income contribution statement,

estimasi profit pada tingkat penjualan tertentu dapat dilakukandengan cara: mengalikan jumlah unit terjual di atas break-

even dengan CM per unit.

If Racing sellsIf Racing sells430 bikes, its430 bikes, its

net income willnet income willbe $6,000.be $6,000.

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CVP Relationships in Graphic Form

The relationship among revenue, cost, profit and volume canbe expressed graphically by preparing a CVP graph.

Racing developed contribution margin income statements

at 300, 400, and 500 units sold. We will use thisinformation to prepare the CVP graph.

Income

300 units

Income

400 units

Income

500 units

Sales 150,000$ 200,000$ 250,000$Less: variable expenses 90,000 120,000 150,000

Contribution margin 60,000$ 80,000$ 100,000$

Less: fixed expenses 80,000 80,000 80,000

Net operating income (20,000)$ -$ 20,000$

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CVP Graph

-

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

- 100 200 300 400 500 600 700 800

Fixed Expenses

Total Expenses

Total Sales

Units

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CVP Graph

-

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

- 100 200 300 400 500 600 700 800

Units

BreakBreak--even pointeven point(400 units or $200,000 in sales)(400 units or $200,000 in sales)

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Contribution Margin Ratio

The contribution margin ratio is:

Pada Racing Bicycle Company, rasionya adalah:

Total CMTotal sales

CM Ratio =

Setiap $1.00 kenaikan sales, menyebabkankenaikan dalam contribution margin 40.

= 40%$80,000

$200,000

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Atau, dalam unit, the CM ratio is:

Pada Racing Bicycle Company, rasio-nya adalah:

$200$500

= 40%

Unit CMUnit selling price

CM Ratio =

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400 Bikes 500 Bikes

Sales 200,000$ 250,000$

Less: variable expenses 120,000 150,000

Contribution margin 80,000 100,000Less: fixed expenses 80,000 80,000

Net operating income -$ 20,000$


Kenaikan sales revenue $50,000 akanKenaikan sales revenue $50,000 akanmenaikkan CM $20,000 ($50,000menaikkan CM $20,000 ($50,000

40% = $20,000)40% = $20,000)

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Quick Check

Coffee Klatch is an espresso stand in adowntown office building. The average selling

price of a cup of coffee is $1.49 and the averagevariable expense per cup is $0.36. The averagefixed expense per month is $1,300. 2,100 cups aresold each month on average. What is the CM Ratiofor Coffee Klatch?

a. 1.319 c. 0.242

b. 0.758 d. 4.139

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Changes in Fixed Costs and

Sales VolumeBagaimana dampak profit jika Racing

dapat meningkatkan unit sales dari500 ke 540 dengan cara meningkatkanmonthly advertising budget $10,000?

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Sales Volume

SalesSales increasedincreasedby $20,000, but net operatingby $20,000, but net operating

incomeincome decreaseddecreasedby $2,000by $2,000..

Advertising budget dinaikkan $ 10,000 sehingga

menjadi $ 90,000 ($80,000 + $10,000)

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Sales Volume

The ShortcutSolution

Hitung dengan menggunakan: CM ratio ($); dan

CM ratio (unit)

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Change in Variable Costs and

Sales VolumeRacing menggunakan raw materials yangkualitasnya lebih tinggi sehingga variable

costs per unit meningkat $10, berapakah profityang dapat diperoleh jika unit salesditingkatkan dari 500 menjadi 580?

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Change in Variable Costs and

Sales Volume580 units580 units $310 variable cost/unit = $179,800$310 variable cost/unit = $179,800

SalesSales increaseincrease by $40,000, andby $40,000, andnet operating incomenet operating income increasesincreases by $10,200by $10,200..

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Change in Fixed Cost, Sales Priceand Volume

Jika Racing (1) memotong selling price-nya$20 per unit, (2) meningkatkan anggaran

advertising-nya $15,000 per bulan, dan (3)meningkatkan unit sales dari 500 menjadi650 units per bulan. Berapakah profitnya?

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SalesSales increaseincrease by $62,000, fixed costs increase byby $62,000, fixed costs increase by$15,000, and net operating income$15,000, and net operating income increasesincreases by $2,000by $2,000..

Change in Fixed Cost, Sales Price

and Volume

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Change in Variable Cost, Fixed Cost

and Sales Volume

Jika Racing (1) membayar salescommission $15 per sepeda yang terjual,

menurunkan gaji salespersons $6,000 perbulan, and (2) meningkatkan unit sales dari

500 menjadi 575 unit sepeda?

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Change in Variable Cost, Fixed Cost

and Sales Volume

SalesSales increaseincrease by $37,500, variable costsby $37,500, variable costs increaseincrease byby$31,125, but fixed expenses$31,125, but fixed expenses decreasedecrease by $6,000by $6,000..

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Change in Regular Sales Price

Jika Racing memiliki kesempatan untukmenjual 150 unit sepeda ke distributor

tanpa mengganggu penjualan ke customerdan tanpa merubah fixed expenses,

berapa harga yang ditetapkan kedistributor jika profit bulanan ingin

ditingkatkan $3,000?

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Change in Regular Sales Price

3,000$ 150 bikes = 20$ per bike

Variable cost per bike = 300 per bike

Selling price required = 320$ per bike

150 bikes $320 per bike = 48,000$

Total variable costs=

45,000Increase in net income = 3,000$

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Break-Even Analysis

Analisis break-even dapat

dilakukan dengan dua cara:1. Equation method

2. Contribution margin method

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Equation Method

Profits = (Sales Variable expenses) Fixed expenses

Sales = Variable expenses + Fixed expenses + Profits

OR

At the breakAt the break--even point,even point,

profits equal zeroprofits equal zero

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Break-Even Analysis

Here is the information from Racing BicycleCompany:

Total Per Unit Percent

Sales (500 bikes) 250,000$ 500$ 100%

Less: variable expenses 150,000 300 60%

Contribution margin 100,000$ 200$ 40%

Less: fixed expenses 80,000

Net operating income 20,000$

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Equation Method

We calculate the break-even point as follows:


$500Q = $300Q + $80,000 + $0

Where:

Q = Number of bikes sold$500 = Unit selling price$300 = Unit variable expense

$80,000 = Total fixed expense

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Equation Method

$500Q = $300Q + $80,000 + $0$200Q = $80,000

Q = $80,000 $200 per bikeQ = 400 bikes

We calculate the break-even point as follows:


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Equation MethodPersamaan ini dapat dimodifikasi untuk

menghitung BEP dalam sales dollars.


X = 0.60X + $80,000 +X = 0.60X + $80,000 + $0$0Where:

X = Total sales dollars0.60 = Variable expenses as a % of sales

$80,000 = Total fixed expenses

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Equation Method

X = 0.60X + $80,000 + $00.40X = $80,000

X = $80,000 0.40X = $200,000


Persamaan ini dapat dimodifikasi untukmenghitung BEP dalam sales dollars.

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Contribution Margin Method

Contribution margin methodmemiliki dua persamaan:

Fixed expensesUnit contribution margin

=Break-even point

in units sold

Fixed expensesCM ratio

=Break-even point intotal sales dollars

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Contribution Margin Method

Lets use the contribution margin method tocalculate the break-even point in total sales

dollars at Racing.

Fixed expensesCM ratio

=Break-even point intotal sales dollars

$80,000$80,00040%40%

= $200,000 break= $200,000 break--even saleseven sales

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Quick Check

Coffee Klatch is an espresso stand in adowntown office building. The averageselling price of a cup of coffee is $1.49 andthe average variable expense per cup is$0.36. The average fixed expense per monthis $1,300. 2,100 cups are sold each monthon average. What is the break-even sales in

units?a. 872 cups c. 1,200 cups

b. 3,611 cups d. 1,150 cups

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Quick Check

Coffee Klatch is an espresso stand in adowntown office building. The average

selling price of a cup of coffee is $1.49and the average variable expense per cupis $0.36. The average fixed expense permonth is $1,300. 2,100 cups are sold

each month on average. What is thebreak-even sales in dollars?

a. $1,300 c. $1,788

b. $1,715 d. $3,129

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Target Profit Analysis

Equation dan contribution margin methodsdapat digunakan untuk menetapkan

volume penjualan yang dibutuhkan untukmencapai a target profit.

Misal: Racing Bicycle Company inginmengetahui berapa unit sepeda yang harusdijual untuk mendapatkan profit $100,000.

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The CVP Equation Method


$500Q = $300Q + $80,000 + $100,000

$200Q = $180,000

Q = 900bikes

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The Contribution Margin Approach

The contribution margin method can beused to determine that 900 bikes must besold to earn the target profit of $100,000.

Fixed expenses + Target profitUnit contribution margin

=Unit sales to attain

the target profit

$80,000 + $100,000$200/bike

= 900bikes

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Quick Check

Coffee Klatch is an espresso stand in adowntown office building. The average selling

price of a cup of coffee is $1.49 and the averagevariable expense per cup is $0.36. The averagefixed expense per month is $1,300. How manycups of coffee would have to be sold to attain

target profits of $2,500 per month?a. 3,363 cups c. 1,150 cups

b. 2,212 cups d. 4,200 cups

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The Margin ofSafety

The margin of safety is the excess ofbudgeted (or actual) sales over the

break-even volume of sales.Margin of safety = Total sales - Break-even sales

Lets look at Racing Bicycle Company and

determine the margin of safety.

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The Margin ofSafety

The margin of safety can be expressed as20% of sales.

($50,000 $250,000)Break-even

sales

400 units

Actual sales

500 units

Sales 200,000$ 250,000$

Less: variable expenses 120,000 150,000

Contribution margin 80,000 100,000

Less: fixed expenses 80,000 80,000

Net operating income -$ 20,000$

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The Margin ofSafety

The margin of safety can be expressed interms of the number of units sold. The

margin of safety at Racing is $50,000,and each bike sells for $500.

Margin ofSafety in units

= = 100 bikes$50,000$500

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Quick Check

Coffee Klatch is an espresso stand ina downtown office building. The average

selling price of a cup of coffee is $1.49and the average variable expense percup is $0.36. The average fixed expenseper month is $1,300. 2,100 cups are sold

each month on average. What is themargin of safety?

a. 3,250 cups c. 1,150 cups

b. 950 cups d. 2,100 cups

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CostStructure and Profit

StabilityCost structure refers to the relative proportion of

fixed and variable costs in an organization.

Managers often have some latitude in determiningtheir organizations cost structure.

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CostStructure and ProfitStability

There are advantages and disadvantages to highfixed cost (or low variable cost) and low fixed

cost (or high variable cost) structures.An advantage of a high fixed

cost structure is that incomewill be higher in good years

compared to companieswith lower proportion of

fixed costs.

A disadvantage of a high fixed

cost structure is that incomewill be lower in bad yearscompared to companieswith lower proportion of

fixed costs.

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Operating Leverage

A measure ofhow sensitive net operating

income is to percentage changes in sales.Contribution marginNet operating income

Degree ofoperating leverage

=

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Operating Leverage

Actual sales

500 BikesSales 250,000$

Less: variable expenses 150,000

Contribution margin 100,000

Less: fixed expenses 80,000Net income 20,000$

$100,000

$20,000

= 5

At Racing, the degree of operating leverage is 5.

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Operating Leverage

Actual sales

(500)

Increased

sales (550)

Sales 250,000$ 275,000$

Less variable expenses 150,000 165,000


Less fixed expenses 80,000 80,000

Net operating income 20,000$ 30,000$

10% increase in sales from$250,000 to $275,000 . . .

. . . results in a 50% increase in

income from $20,000 to $30,000.

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Quick Check

Coffee Klatch is an espresso stand in adowntown office building. The averageselling price of a cup of coffee is $1.49

and the average variable expense per cupis $0.36. The average fixed expense permonth is $1,300. 2,100 cups are soldeach month on average. What is theoperating leverage?

a. 2.21 c. 0.34

b. 0.45 d. 2.92

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Quick Check

At Coffee Klatch the average selling priceof a cup of coffee is $1.49, the average

variable expense per cup is $0.36, and theaverage fixed expense per month is $1,300.2,100 cups are sold each month on average.

If sales increase by 20%, by how muchshould net operating income increase?

a. 30.0% c. 22.1%b. 20.0% d. 44.2%

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Verify Increase in ProfitActual

sales

Increased

sales

2,100cups 2,520cups

Sales 3,129$ 3,755$Less: Variable expenses 756 907


Less: Fixed expenses 1,300 1,300

Net operating income 1,073$ 1,548$% change in sales 20.0%

% change in net operating income 44.2%

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Structuring Sales CommissionsCompanies generally compensate

salespeople by paying them either a

commission based on sales or a salary plus asales commission. Commissions based onsales dollars can lead to lower profits in a

company.

Lets look at an example.Lets look at an example.

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Structuring Sales CommissionsPipeline Unlimited produces two types of surfboards,the XR7 and the Turbo. The XR7 sells for $100 and

generates a contribution margin per unit of $25. TheTurbo sells for $150 and earns a contribution margin

per unit of $18.The sales force at Pipeline Unlimited is

compensated based on sales commissions.

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Structuring Sales CommissionsIf you were on the sales force at Pipeline, you would

push hard to sell the Turbo even though the XR7

earns a higher contribution margin per unit.

To eliminate this type of conflict, commissions canbe based on contribution margin rather than on

selling price alone.

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The Concept ofSales Mix

Sales mix is the relative proportion in which acompanys products are sold.

Different products have different sellingprices, cost structures, and contributionmargins.Lets assume Racing Bicycle Company sells

bikes and carts and that the sales mixbetween the two products remains the same.

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Multi-product break-even

analysisRacing Bicycle Co. provides the following

information:

$265,000$550,000

= 48.2% (rounded)

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Multi-product break-even analysis

Fixed expensesCM Ratio

Break-evensales

$170,000

48.2%

= $352,697

=

=

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Key Assumptions of CVP Analysis

Selling price is constant.

Costs are linear.

In multi-product companies, thesales mix is constant.

In manufacturing companies,inventories do not change (unitsproduced = units sold).

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