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BREAK EVEN ANALYSISBreak even analysis is mainly used to explain the relationship between the cost incurred, the volume operated at and the profit earned. To compute the breakeven point we let
S be selling price per unitVu be variable cost per unitQ be break-even quantitiesF be total fixed costsAt Breakeven point:
Total revenue (TR) = Total Cost (TC)
Total revenue will be given by SQ while Total cost (TC) = Vu Q + F
At break-even point (BEP) therefore:
SQ = Vu Q + FQ = F S- VuB.E.P (in units) = F S- Vu
Integer Programming It is a technique for solving a linear programming model with an added constraint that the decision variables must only be non-negative integers. In the
JOINT PRODUCT DECISIONS When a manufacturing Company carries out a process operation in which 2 or more joint products are made from a common process a number of decision troub
Compute the equ units of production?
Elimination of non-value added activity JIT manufacturing can be described as a philosophy of management, dedicate to the elimination of waste. Waste is stated as anything whic
Cost driver analysis Cost drivers are factors, which determine the costs of an activity i.e. a change in the cost driver will cause a change in the level of total cost relate
Full Service Non Recourse: in this method the book debts are purchased through the factor assuming 100 percent credit risk. In case of default through the debtor the whole risk is
Traditional budgeting vs. zero base budgeting 1) Traditional budgeting is accounting oriented. Main stress happens to be on previous level of expenditure. Zero base budgeting m
Marginal cost or incremental cost pricing method: Here the company may work on the premise of recovering its marginal cost and getting a contribution towards its overheads. Thi
Interpretation of equity ratio As equity ratio show the relationship of owner funds to total assets higher the ratio or the share of the shareholders in the total capital of th
Budgetary Control According to brown and Howard According to brown and Howard," budgetary control is a system of controlling costs which includes the preparation of budget coor
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