Identify Five Benefits of EVA

question 38

Essay

Identify five benefits of EVA.

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Definitions:

Cost-volume-profit

An analysis to determine how changes in costs and volume affect a company's operating income and net income.

Fixed Costs

Costs that do not change in total despite fluctuations in the volume of goods or services produced or sold.

Variable Costs

Charges that fluctuate according to the degree of business operations.

Cost-volume-profit Graph

A graphical representation that shows the relationship between a company's costs, its sales volume, and its profits, used for planning and decision-making.