How do you determine whether a business idea is financially feasible? You need to evaluate the economic viability of your business idea by considering your start-up cost, cash flow and operational expenses.

What should be included in the Financial Projections portion of the business plan? The financial section of your business plan should include a sales forecast, expenses budget, cash flow statement, balance sheet, and a profit and loss...

This is a great activity to simulate the labor market and show how a business decides how many workers to hire. Watch the video and see if you can figure out the following: 1. How many workers should be hired to maximize profit? 2. What...

Join the hundreds of thousands of students that have used Mr. Clifford's videos and resources to ace your microeconomics course.

In this video I explain how to draw and analyze the cost curves. Most teacher sad professors focus on the per unit cost curves. That included marginal cost, average total cost, average variable costs, and the average fixed cost. Each...

Here is a practice FRQ from the 2005 AP Micro exam. Try it on your own and then go over the answers. Good luck.

Unit cost is an important metric for manufacturing firms to judge efficiency, profitability, and pricing

This video explains the concept of break-even point in business. The video discusses how to calculate break-even point and the formula to use. The video also provides an example calculation of break-even point and how to calculate profit...

The video is about understanding costs in business. The presenter explains how sales revenue is calculated and how it incurs costs for a business. The different types of costs are discussed, including fixed costs, variable costs, and...

Measuring the performance of a profit center is based upon the reporting of profits and losses. Pursuing an absorption or variable costing approach for inventory will alter the gross profit calculation.

This video provides an introduction and detailed explanation of marginal and average costs in economics. The presenter explains the definitions of marginal and average costs, and demonstrates how to calculate them using a hypothetical...

Cost classification is a major component of absorption and variable costing. Absorption costing allocates fixed overhead to Cost of Goods Sold while Variable costing allocates fixed overhead to whisl Selling General and Administrative...

Cost behavior generally concerns how costs are affected by changes in output. The relevant range is the range of production over which cost behavior is consistent.

A sensitivity analysis as part of the cost volume profit analysis shows how profits vary with changes in cost or volume.

Risk and uncertainty are present throughout the Cost Volume Profit analysis. Namely, there are numerous assumptions about revenue and expenses. The methods used to estimate these variables seeks to minimize the level of risk present.

This video explains the concept of cost volume profit (CVP) analysis and the relationships between various metrics used in this analysis. The video delves into key metrics such as contribution margin, net income, variable expense ratio,...

Costs change or react to changes in other organizational levels or variables. Most notably, the Cost Volume Profit analysis analyzes changes in cost related to profitability and volume.

Segmented income statements using variable costing approach is a useful tool for managerial accounting. It separates how fixed and variable expenses are accounted for.

Contribution margin is a key assumption when conducting a Cost Volume Profit Analysis. This video explains the relevance of this assumption.

This video provides an overview of variable overhead analysis, its importance in decision making and budgeting, and the metrics used to measure and analyze these costs.

Absorption costing and variable costing are two methods of accounting for use of inventory or costs of goods sold in an organization

This video explains what are mixed costs (generally a mix between fixed and variable costs) and how those costs are recorded in managerial accounting.

This video is a lecture presentation on the concept of profit in business. The presenter explains the equation for profit, which is revenue minus costs, and breaks it down into its constituent parts such as revenue, fixed costs, variable...

The break even point for an organization can be calculated as either the total number of units sold or the total value of units sold.