CVP-analysis as a tool for management decision-making
Subject. Criteria for making management decisions based on the results of management analysis. The goal. To evaluate the effectiveness of the «cost - volume - profit» method in making management decisions to maximize the profits of industrial organizations. Method or methodology. A method of scientific research based on the analysis of the methodology of managerial decision-making based on the margin approach; as well as an empirical method that reveals an overview of the current practice of margin analysis, a generalization of scientific literature. The method of CVP-analysis has been adapted in relation to the sugar industry. According to this methodology, calculations of the break-even point, safety margin, margin income and operational leverage are given and recommendations for making managerial decisions are substantiated. Results of the work. The possibility of increasing the profit of the sugar industry organization through the development of financial management solutions based on the results of margin analysis is considered. Conclusions. CVP-analysis helps business managers to identify the optimal proportions between variable and fixed costs, price and volume of sales, and minimize business risk.