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In this method, approximation of various assets here excluding cash and including liabilities are made getting into consideration the transactions in the ensuring period. Afterward, a balance sheet is prepared that depends on these forecasts. Liabilities and Assets are termed as 'Projected balance sheet'. The dissimilarity between liabilities and assets of this balance sheet is termed as shortage or surplus cash of such period. If the net liability is more than net assets, this represents excess cash that is not needed by the firm. The management may plan for such investment. Conversely, if total assets are more than net liabilities, so it shows the deficiency of working capital that is to be arranged through the management either from bank overdraft or by the other sources.
In this section we have discussed the motives for conducting cash balances. In addition, we have discussed cash deficit or surplus situation and how it can be contained by the use
Illustration: ABC analysis Combine items on the basis of their relative value to form three categories—A, B and C. The data in the table below illustrates the ABC analysis.
Transition probabilities These are the probabilities of moving from one state to another in the next time period. Usually they are written in the form of a probability matrix.
What is Sunk cost A cost has been incurred in the past or sunk in the past and is not relevant to the particular decision making, is a sunk cost. If it is decided to replac
Moore Company uses process costing. The following information was available for October: During October, 1,000 units were started, and costs incurred during the month were
taking the role of a consultant, discuss the factors you would consider in selecting a suitable accounting system solutio for a small to medium enterprise. i has to be 1200 q\work
School problem is asking to calculate the work in progress inventory for the beginning of a month without providing previous month data.
depreciation,depletion and amortisation
Advantages and limitations of game theory Advantage: Game theory helps us to learn how to approach and understand a conflict situation and to improve the decision maki
Factory Layout The first stage of implementing the JIT manufacturing techniques is to rearrange the factory floor away from the batch production functional layout towards a pro
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