Question

Consider where you currently work, where you have previously worked, or a well-known company where you would like to work. How would this company use CVP analysis? What types of decisions could they make using the tools that you have learned during this topic? Explain.

150 WORDS, PLEASE.

Answer 1

I would like to work for Boeing Commercial Airplanes, a business unit of the Boeing Company. It focuses on manufacturing airplanes for customers around the world. The components of the CVP analysis can identify costs which will help decision makers manage product, labor and manufacturing overhead costs.For example, if the manufacturing overhead costs are high, CVP analysis will help to identify what the actual costs that must be decreased are; if a fixed cost like property tax is too high, then looking for a lowor no property tax location may be an option. If a variable cost like labor is too high or too low, then Boeing could consider to either reduce or recruit manpower. The same principle applies to material costs. The purchase and freight costs determine whether Boeing needs to establish its production or not.

Thanks