Assumptions-relevant costs , Managerial Accounting

Assignment Help:

Assumptions for relevant costs

The key assumptions made in relevant costing are:

The cost behavior is recognized.
The amount of fixed costs, unit variable costs, selling prices and sales demand are known with certainty.
The objective of the decision maker in the short-term is to maximize satisfaction which can be defined as maximization of short-term profit.
The information on which the decision is based is complete and reliable.

There are various types of decisions that can be considered in this section, Illustrations comprise:

a. Make or Buy decisions
b. Shut down problems
c. Extra shift decisions
d. Joint cost decisions

Related Discussions:- Assumptions-relevant costs

Estimate a demand function and forcast demand, Question 1: Assuming tha...

Question 1: Assuming that you are appointed consultant on economic matters for a company and you are asked to analyse the market structures in various sectors of the economy.

What does your analysis tell you about each firm, When the stock market is ...

When the stock market is going up over a long period of time, investors can become complacent about the risks of being a stockholder. After the significant decline of the stock mar

Game theory, Game Theory Game theory was developed for the purpose of a...

Game Theory Game theory was developed for the purpose of analyzing competitive situation involving conflicting interests. In game theory, there are assumed to be two or more pe

Loan syndication, Loan Syndication : There are two ways of syndication a...

Loan Syndication : There are two ways of syndication as: direct lending and through participation. - Direct Lending: regarding "direct lending" all the lenders sign the loa

Marginal costing variances, reasons for favourable or adverse variances i....

reasons for favourable or adverse variances i.e. prise usage, mix, yeild

POHR, #questioExercise 3-12 Computing Predetermined Overhead Rates and Job ...

#questioExercise 3-12 Computing Predetermined Overhead Rates and Job Costs [LO1, LO2, LO3, LO7] Kody Corporation uses a job-order costing system with a plantwide overhead rate base

Risk-fundamental uncertainty-decision making environment, Risk : Risk i...

Risk : Risk includes circumstances or events that may or may not take place though whose probability of occurrence can be predicted from the past records. In this atmosphere, t

What procedure are followed in kaizen costing, What Procedure are followed ...

What Procedure are followed in kaizen costing In brief kaizen costing involves setting a new cost reduction target every month. The difference between the target profits and th

Assignment help, Assignment help

Assignment help

What are selling and distribution expenses, What are Selling and distributi...

What are Selling and distribution expenses? Selling and distribution expenses incurred for the marketing of a commodity, for securing orders for the articles, dispatching goods

Write Your Message!

Name

Email id

Message

Verfication Code

User Account

All Pages