How would you convince Mr. Adrian and other executive-level staff that CVP analysis would benefit Oslow Company?

Cost-volume-profit  analysis allows managers to see how changes in costs and volume will affect the company’s operating expenses and net income or net assets . This form of analysis compares different relationships, such as the cost of operating and producing goods and services, the volume of goods and services sold, and the profits generated from the sale of those goods and services. Cost-volume-profit analysis helps managers make rational decisions such as what products and services to offer, what prices to charge, what marketing strategy to use, and what cost structure to maintain. Its primary purpose is to estimate how profits are affected by the following five factors: selling prices, sales volume, unit variable costs, and total fixed costs.
Oslow Company prepared the following contribution format income statement based on a sales volume of 2,000 units .
Sales                                                         $20,000
Variable Expenses                                   12,000
Contribution Margin                               8,000
Fixed Expenses                                        6,000
Net Operating Income                            $ 2,000
One member of Oslow Company  has challenged the fixed expenses.  Mr. Adrian says “There is no such thing as a fixed cost.  All costs can be unfixed given sufficient time.”  Mr. Adrian also has made the comment that gross margin is more significant than contribution margin.  And he states that since Oslow Company produces multiple products, CVP analysis cannot be computed.  Mr. Adrian has been vocal with his thoughts throughout the production departments of Oslow Company.

Initial Post Directions

Oslow has never utilized CVP methodologies before. You are the new CFO for Oslow Company.  How would you convince Mr. Adrian and other executive-level staff that CVP analysis would benefit Oslow Company?