Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
The current sales of M/s ABC are Rs.100 lakhs. Through relaxing the credit standards the firm can produce additional sales of Rs.15 lakhs on that bad debt losses would be 10 percent. The variable cost for the firm is, 80 percent average collection period ACP is 40 days and post tax cost of funds is 10 % and the tax rate applicable to the firm is 40%. Determine whether the firm must relax credit standards or not?
Solution:
? NP = [ ? S (1-V) - ? S bn] (1-t) - k ? I
? NP = [15 (1-.80) - 15 × .1] (1-.4) -.10 × (15/360) × 40 ×.80
= [3 -1.5] (.6) -.1333
=.9 -.1333
=.7667 × 1,00,000
=76,667
As the impact of change in credit standards outcomes in a positive change in total profits thus the proposed change must be accepted.
Steps of Graphic Analysis There are four steps in using graph paper to study cost-volume relationships: Step 1: Compute the scale which you will use: Volume is considered
Stages in activity based costing The different stages in activity based costing are listed below and are shown in figure below. 1) Identification of the activities that may
Lock Box System: In this type of system, the customers are advised to mail their payments to a post office box hired through the firm for collection purposes near their region. T
given the above data what would the breakeven in units and dollars be if u wanted a necessary after tax profit of $ 36,000 (assume a 30% tax rate ) units __________ ales dollars _
Explain the growth, index, sectoral, gilt and money market methods? (i) What are the key variations among the open ended and close ended methods? What are the plus and minuses
Market value There is universal agreement that in competitive markets a market value based transfer price should achieve optimal results. In this circumstance, it can be expected
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
Advantages of standard costing 1) Measuring efficiency: standard costing is a yardstick for measuring efficiency. The comparison of actual costs with standard costs enables t
Willco Inc. manufactures electronic parts. They are analyzing their monthly maintenance costs to determine the best way to budget these costs in the future. They have collected the
Decide which costs are associated with the assignment of cost for a Job Order Costing System. Select all that apply. cost graphs (Points : 1) Raw materials are used
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd