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Advantages of activity based costing 1) It helps understanding the behavior of overhead costs and their relations ship to products services customers and market segments. 2)
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.
Assumption of break even analysis The break even analysis is based upon the following assumptions : 1) All elements of cost, i.e., production , administration and selling di
RULES OF GAME THEORY 1) The number of competitors is finite. 2) There is a conflict of interests between the participants. 3) Each of these participants has available to
what is Long term budgets Long term budgets: The budgets are prepared to depict long term planning of the business. The period of long term begets various between five to ten
Competition oriented pricing policy Most companies fix the price of their products after a careful consideration of the competitor's price structure. Deliberate policy may be f
Types of games Four basic ways in which competitive situations (or games) can be classified are: (a) Number of Competitors: In game theory a competitor is characteriz
Compute the value of share of a company? A company paid dividend amounting to Rs. 0.75 each share during the last year. The company is supposed to pay Rs. 2.00 per share throug
Determine the Need and importance of management accounting: 1.Increasing efficiency: management accounting increases efficiency of business operations. The targets of differe
What is period cost Period costs are those costs which are reported as expanses of the period in question. These are cost which are not assigned to the product but are charged
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