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Question
what is the meaning of P/V Ratio?
 Question Submitted By :: Accounting-AllOther
I also faced this Question!!     Answer Posted By  
 
Answer
# 1
The sales and marginal costs vary directly with the number
of units sold or produced. So, the difference between sales
and marginal cost, i.e. contribution, will bear a relation
to sales and the ratio of contribution to sales remains
constant at all levels. This is profit volume or P/V ratio.
Thus,

p/v ratio = contribution /sales x100
 
Is This Answer Correct ?    425 Yes 35 No
Kafeeel
 
Answer
# 2
P/V Ratio is the relationship between the profit & sales.In
formula it is expressed as P/V Ratio=
Contribution/sales*100.The higher the P/V Ratio better is
for company prospects.
 
Is This Answer Correct ?    204 Yes 37 No
Kiran Pandit
 
 
 
Answer
# 3
P/V ratio express the relationship between sales and
contribution.In formulait is expressed as P/V Ratio=
contribution/sales*100, sales-variable cost/sales*100
 
Is This Answer Correct ?    119 Yes 22 No
Laxman
 
Answer
# 4
P/V ratio or profit volume ratio is the ratio of change in
profit to change in sales it can be computed in any of the
following four methods:-

1)[Contribution/Sales]*100
2)[(Fixed Cost + Profit)/Sales]*100
3)[(Sales - Variable Cost)/Sales]*100
4)Change in Profit/ Change in Sales
 
Is This Answer Correct ?    82 Yes 9 No
Krish
 
Answer
# 5
P/V ratio express the relationship between sales and
contribution.
contribution is sales - variable cost.

contribution
P/V Ratio= ------------ * 100
Sales
 
Is This Answer Correct ?    61 Yes 6 No
Hari Enaganti.
 
Answer
# 6
The sales and marginal costs vary directly with the number
of units sold or produced. So, the difference between sales
and marginal cost, i.e. contribution, will bear a relation
to sales and the ratio of contribution to sales remains
constant at all levels. This is profit volume or P/V ratio.
Thus, p/v ratio = contribution /sales x100
 
Is This Answer Correct ?    49 Yes 13 No
Jacobjijimon
 
Answer
# 7
profit volume ratio is a ratio which is calculated in order
to determine the relationship between sales volume and
profit of a company.The general formula of calculating p/v
ratio is as follows:

p/v ratio = contribution/sales * 100
 
Is This Answer Correct ?    43 Yes 7 No
Abhinav
 
Answer
# 8
In business it is very tough to tell about the net profit
ratio of a particular activity undertaken by it because it
is easy to tell about the variable cost of that activity
but it is tough to tell about the fixed cost to be charged
on that activity therefore we subtract the variable cost
from the selling price and the amount so received is termed
as contribution which tells us about the amount contributed
from sales after variable cost to coverup the fixed cost.
And it is computed as :-
contribution/sales*100
which tells the per unit contribution towards fixed cost.
 
Is This Answer Correct ?    41 Yes 8 No
Ankur
 
Answer
# 9
NEEDS:-To know the profitability of any business.
P/v ratio: Shows the relationship between contribution and
sales.
Usually expressed in percentage.
contribution =selling price-variable cost
=fixed cost+ profit or - loss
contribution
p/v ratio = -------------- * 100
sales
 
Is This Answer Correct ?    19 Yes 1 No
K. V. Shukla
 
Answer
# 10
This ratio shows the information for analysing the profit
impact because of changes in sales volume, change in cost &
price of firm.
 
Is This Answer Correct ?    44 Yes 33 No
Geeta Jain
 

 
 
 
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