§5 Supplementary explanations for the Managed-gross-profit chart theory

5-1. Preface  

The "Managed-Gross-Profit Chart Theory" is a method for charting an income statement under absorption costing, or full costing. It was formulated by me in 1996, which was publicly opened in references (1) or asked for patent in references (2), (3) and (4).  
            References
In reference (1) , written in Japanese, the theoretical formulation was made leaving difficulty in mathematical derivations. The reason was that my theory was in its formative stage.  
In reference (2), the equations were represented in completed forms of equations omitting some mathematical derivations. The 2nd kind of absorbed manufacturing overhead was not explained in full detail for simplicity.
This paper is presented for both users of the managed-gross-profit chart and persons who intend to examine this theory, in order to give supplementary explanations for these references, and to remark on the chart from his user’s standpoint.  
The managed-gross-profit chart can be applied in various business situations. Users of the chart only need to know that an income statement under absorption costing can be easily converted to the chart, if they could not understand the mathematical derivations.