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CVP Analysis
Short for Cost-Volume-Profit Analysis, a tool used to determine how changes in cost and volume affect a company's operating income and net income.
Variable Costs
Variable Costs are costs that vary directly with the level of production or sales volume.
Fixed Costs
Expenses that do not change with the level of production or sales, such as rent, salaries, and insurance premiums, which are constant regardless of business activity levels.
Trade Discount
A discount granted by the supplier to a purchaser of goods for resale.
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