Abstract:
Cost is in reality an interface between financial accounting and
management accounting. The aim of the paper is to determine the need and
opportunity of the cost - volume – profit analysis for the economic entities in
the field of agriculture. Taking into account the peculiarities of agricultural
production, the research is based on analysis of the following indicators: the
threshold of profitability, coverage factor, the factor of balance and safety.
The results of our research suggest that cost - volume – profit analysis is a
necessary tool for cost forecasting as well for management cost control. The
opportunity of such an analysis in the agricultural sector is justified through
that it helps the managers find the best cost, in the sense of the most adequate
cost for their administrative problems. The best cost for a firm isn’t
necessarily the lowest, but that cost that comes at the right time. This
analysis is necessary to evaluate new types of crops to plant and to undertake
studies on the structure of sales.
