Cost Volume Profit Analysis For Profit Planning At Shinta Bakery

Abstract

Cost-Volume-Profit Analysis (CVP) is an important

Cost Volume Profit financial management tool for businesses that want to understand the relationship between costs, sales volume, and profits. This analysis enables organizations to make decisions based on an understanding of break-even points, pricing strategies, and profit targets. By examining fixed costs, variable costs, selling prices, and desired profit levels, CVP analysis provides valuable insights to optimize business operations and maximize profitability. This research was conducted at MSME Shinta Bakery located on Jalan Bojonegoro Ngawi, Ngraho District, Kab, Bojonegoro, East Java. Shinta bakery is a company engaged in bread and cakes. The analysis methods in this study are break even point analysis, contribution margin analysis and contribution margin ratio, margin of safety analysis, and total operating laverage. The main benefit of CVP analysis is that it assists managers in determining the right selling price, planning the desired profit, as well as identifying potential areas to reduce costs. By understanding the concept of CVP, companies can optimize their cost structure and increase profitability. In addition, this analysis can be used to measure risk in business decision making and help managers understand the impact of changes in sales strategy or costs on net income. The results of this 2023 study show that BEP (units) must sell 56,849.27 and BEP (rupiah) must get income of IDR 105,970,145.45 so as not to experience losses. Contribution Margin Ratio 55%, Margin Of Safety in rupiah can be a maximum decrease of IDR 498,474,454.5 and Degree Of Operating Leverage shows Contribution Margin of 1.2 times operating profit