Knowing the relationship among cost, volume and profit, or CVP, is your most powerful tool in making better decisions. It will show you:the volume of sales required to break even and generate profit,the proper menu pricing in relation to cost of sales,the impact of product sales mix on product contribution,and whether to open or close an operation.The following scenario will help you understand CVP relationships.Assume, due to the recession, you closed a restaurant or profit center within ...
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