P/V or C/S ratio

skips

hello
can anyone explain to me what this is and when would you use it?! and how do you calculated expected profit?!

thanks
Skips

CathG

PV Ratio

Profit Volume ratio is calculated thus:

contribution/selling price

eg: £10 contribution
£30 selling price = 0.33 x 100 = 33%

so in this instance the contribution makes up 33% of the selling price.

PV ratio can be used to find sales revenue break even figure:

fixed costs £5000
PV Ratio 0.33 = 15,152