You are planning to open a new restaurant and need to determine how many dinners need to be sold to stay above the break-even point. You will investigate Cost Volume Profit (CVP), also known as break-even analysis.
-In building an Income statement worksheet,you will calculate variable and fixed expenses based on number of meals sold.To explore the impact of changing different values in the worksheet,you can use _______.
A)Solver manager
B)Income Statement Analysis
C)What-If analysis
D)Cash Flow analysis

Question

Quizplus · Accepted Answer

What-If analysis allows you to change different values in a worksheet to explore the impact on the final result, which is exactly what is needed in this scenario. Solver manager is a tool used for optimization problems, Income Statement Analysis is not a tool but a statement itself, and Cash Flow analysis is not relevant in determining how many dinners need to be sold to stay above the break-even point.

You Are Planning to Open a New Restaurant and Need