Managers can use cost-volume-profit analysis to evaluate changes in cost structure.

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Cost-volume-profit analysis helps managers to study the effects of changes in cost structure on profit. It involves analyzing the relationship between sales revenue, costs, and volume of sales to determine the breakeven point and the level of sales required to earn a target profit. This analysis can help managers make informed decisions on pricing strategy, cost control, and product mix.

Managers Can Use Cost-Volume-Profit Analysis to Evaluate Changes in Cost