By Obeta, Ngozi Joy
The utility of Cost-Volume-Profit analysis lies in the fact that it presents a microscopic picture of the profit structure of a business enterprise. It does not only highlight the area of economic strength and weakness in the firm but also sharpens the focus on certain leverage which can be operated upon to enhance its profitability. The objective of this study is to find out the effectiveness and also factors affecting the implementation of this Cost-Volume-Profit analysis in the manufacturing Industry. The researcher in the findings observed that most Industries aim at profit maximization and paid little or no attention to the effect of Cost-Volume-Profit analysis. It was also discovered that the more the cost acquired for a particular production without corresponding increase in the volume of production reduces profit. Therefore, manufacturing Industries should ensure that when cost increases the raw material should equally increase to manufacture more products to cover the variable and fixed cost and also retain a reasonable profit for the firm. Finally, in the office operation budget should be made more detailed, religiously adhered to and controlled more vigorously so as to reduce total operation cost and maximize profit.