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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.
Disadvantages of zero base budgeting 1) It is not suitable for all the activities in an organization 2) It has limited application in a profit making organization. In this c
Computing equivalents units and assigning costs to completed units and ending work in process; no beginning inventory or cost transferred in (30 -45min) Sue Electronics makes CD
Quasar Computers are the first all optical notebooks and their profit largely affects the manipulations in cost, price, total revenue and quantity changes. The market analysis show
Minimal Regret Criterion : This method seeks to minimize the maximum regret that would occur from choosing a particular strategy or alternative. The regret is the opportunit
A purchased product, sold in a retail store, has a normally distributed daily demand, with a mean of 8 units/day and a variance of 4 (units) 2 . Its supply lead time is 6 days and
Battle of the Sexes game To understand Battle of the Sexes game, let’s consider a story as follows: Two players (a couple) wish to go to an event together but disagree about
The Braggs & Struttin'' Company manufactures an engine for carpet cleaners called the "Snooper." Budgeted cost and revenue data for the "Snooper" are given below, based on sales of
Improvement in product design may result in cost reduction illustrated below: 1) Material cost : change in design of the product may result in saving in material cost. Economi
State performance budgeting according to carter performance According to carter performance budgets use statement of mission goals and objectives to explain why the money is be
Open Account Credit sales are usually on open account that implies which the seller ships the goods to the buyer and afterward sends the bill invoice. Consignment In th
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