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Classification of ratio according to significance
The ratios have also been classified according to their significance. Some ratios are more important than other and the firm may classify them as primary and secondary ratio. The British institute of management has recommended the classification of ratio according to importance for inter firm comparisons. For inter firm comparisons the ratios may be classified as primary ratio and secondary ratio. The primary ratio is one which is of the prime importance to concern thus return on capital employed is named as primary ratio. The other ratios which support and explain the primary ratios is called secondary ratio for example the relations ship of operating profit to sales or the relationship of sales to total assets of the firm.
Controlling Things hardly go exactly as planned, and management should make a concerted effort to the monitor and adjust for their deviations. The managerial accountant is the
After going through this section, you must be capable to: Know the need for establishing sound credit policy; Identify the different credit policy variables; Know the cred
distinguish between cost unit and cost centre
The standard cost of chemical mixture ~ PQ’ is as follows: 40% of material P @ Rs. 400 per kg. 60% of material Q @ Rs. 600 per kg. A standard loss of 10% is normally anticipated in
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Logan Products computes its predetermined overhead rate annually on the basis of direct labor hours. At the beginning of the year, it estimated that 39,000 direct labor-hours would
Definition of Activities based costing Activity based costing is a system that focuses on activities as the fundamental cost objects and uses the costs of these activities as b
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