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    ambdelgado's Avatar
    ambdelgado Posts: 5, Reputation: 1
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    #1

    Apr 21, 2007, 07:48 PM
    CVP Equation
    The company C-V-P Equation
    The company sells lawnmowers for $895 each The variable cost per lawnmower is $520. The company's monthly fixed costs are $84,500. Using C-V-P equation, compute the amount of profit the company will have for a month in which the company sells 375 lawnmowers.
    bunnyKutty's Avatar
    bunnyKutty Posts: 60, Reputation: 5
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    #2

    May 12, 2007, 02:43 AM
    C-V-P equation = sales - variable cost = contribution = fixed cost - profit
    Sales = 895 * 375 = 335,625
    Variable cost = 520 * 375 = 195,000
    Fixed cost = 84,500
    Profit = contribution - fixed cost
    Contribution = 335,625 - 195,000 = 140,625
    Profit = 140625 - 84500 = 56,125
    grr82bntx's Avatar
    grr82bntx Posts: 14, Reputation: 2
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    #3

    Aug 18, 2007, 03:19 PM
    ($895 x 375 = $335,625) – ($520 x 375 = $195,000) - $84,500 = $56,125
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