ACT 460 Module 2 Critical Thinking : Cost-Volume-Profit Analysis
Critical Thinking: (90 )
Choose one of the two options below.
Option #1: Cost-Volume-Profit Analysis
Steve Smith has completed a forecast of cost-volume-profit analysis for the Swiss Chocolate Manufacturing Company’s U.S. division manufacturing plant for the coming year. Smith notes the decline in volumes and prepares the breakeven analysis and computes the margin of safety; he notes that the current production volume projections indicate that the margin of safety will be positive for the period. However, the company will not achieve the sales volume required to achieve its desired level of operating and net income. In addition, the degree of operating leverage is high. Rick White has been tasked with suggesting some cost savings by the vice president of operations.
In a well-written paper demonstrating CSU-Global standards, discuss the following.
the greatest impact on the forecast.
that could be addressed, and rationalize your response.
How will this impact the company in the future? Name three ways the company may be impacted by the decision to cut cost.
Your paper should meet the following requirements: