Earning of profit is considered as a main objective a business. Every business concern tries to earn maximum profit or at least satisfactory profit. Though the actual profit earning is left on luck but profit planning should be well designed. So, there are two main goals before it, (a) to maximize its profit and (b) To grow and survive. These two goals can be achieved by it only maintaining proper relationship between the three factors Cost Volume, Profit that ultimately decides the profit structure of a business. For measuring and forecasting the profit of a business the financial experts use the technique of cost -volume profit or Break even analysis, this analysis is the technique which helps in study of relationship.
KEYWORDS: Earning of Profit, Break Even Analysis, Cost - Volume Profit, Product Mix.
Introduction Cost depends upon volume of output and volume of output depends upon selling price along with other factors, while profit depends upon On a large number of factors most important which are the cost of manufacturing and the volume of sales, both these factors are interdependent, volume of sales depends upon the volume of production and market forces which is turn is related to costs. Management has no control over market in order to achieve certain level of profitability; it has to exercise control and management of costs, mainly variable cost. This is because fixed cost is non-controllable cost. Cost is based on following factors.
The Industry attempted humble start in 1906, when the first production unit of Single Super Phosphate (SSP) was installed in Ranipet near Chennai with an annual capacity of 6000 MT. The Fertilizer Corporation of India (FCI) in Sindri in Bihar ( now Jharkhand ) were the first big fertilizer plant installed in the fourth and fifth decade with an attempt to set up an industrial foundation to attain self reliance in food grains. Consequently, green revolt in the sixth decade gave a momentum to the development of fertilizer industry in India and in sixth and eight decade India saw a noteworthy in the capacity of fertilizer production.
