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CONTINUOUS PROBABILITY DISTRIBUTION (USE OF NORMAL DISTRIBUTION)In reality the C-V-P variables might take any values in a continuous range. It could therefore be more appropriate to use a continuous probability distribution such as the normal distribution with an estimated mean and standard deviation. Estimates may be made of the expected sales volume, the expected selling prices, the expected variable cost and the expected fixed costs together with their probabilities.
It would therefore be possible to compute the expected profit and the likelihood that the company would break even or achieve a given target profit.
Rate of return or target pricing method Under this method of price determination first of all a rate of return desired by the enterprises on the amount of profit capital inves
1) FUTURE CASH FLOWS: Prepare a three (3) year forecast of estimated future cash flows for starbucks and give valid economic/business reasons for your projections. This means you w
Activity Based Management (ABM) Also referred to as activity based cost management (ABCM). This is used to describe the cost management application of ABC. To implement A
It refers to the length of time given to the buyer to pay for their purchases. Throughout this period no interest is charged on the excellent amount. The credit period usually vari
After determining the amount of working capital as in above, a specific amount say 5 percent or 10 percent may be added to cover contingencies. This is to be noted that facts depen
WHAT IS PRIME COST?
Adm2341 manufactures and sells four different products. The following data are extracted from the most recent financial statements: Products
The Search for Alternative Courses of Action The second stage of the decision-making model is a search for a range of possible courses of action (or strategies) that might enab
Pricing is a problem in four general types of situations: 1) When the firm develops or introduces a new product and it is fix the price of the product for the first time. 2)
Calculate the EOQ An agent supplies 1000 units per calendar month (PCM) OF A PRODUCT TO CONSUMER. The cost per unit is £175 and the amount cost of storage space is £40. Associ
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