Marginal profit or cost, Managerial Accounting

Assignment Help:

Maximum change in marginal Profit or Cost

Just as we did in studying the permissible ranges for changes in resources, we are also interested in studying the permissible ranges for changes in marginal profits (or costs). We have seen graphically that the objective function coefficients can change within limits without affecting the optimum values of the variables (the optimum value of Z will change, though).

In the present situation, as in the case of resource changes, the objective equation is never used as a pivot equation. Thus, any changes in the coefficients of the objective function will affect only the objective equation in the optimum tableau. This means that such changes can have the effect of making the solution non-optimal. Our goal is to determine the range of variation for the object coefficients (one at a time) for which the current optimum (solution) remains unchanged.


Related Discussions:- Marginal profit or cost

How much was Topaz’s operating income (income before taxes), How much was T...

How much was Topaz’s operating income (income before taxes) last year?

State the debtors turnover ratio, Debtors turnover ratio( or receivables tu...

Debtors turnover ratio( or receivables turnover ratio) Meaning: this ratio establishes a relation ship between net credit sales and averages trade debtors.   Objective

Parameter prediction error-randomness of operating process, Parameter predi...

Parameter prediction error: This is another aspect of faulty planning. As Hongren says, ‘planning decisions are based on predictions of future costs, future selling price, fut

What is activity based management, ABM(Activity based management): ABM ...

ABM(Activity based management): ABM system is primary source of information for AM as a part of ABM identify value added and non-value added activity and management are also to

The least-cost method, The least-cost method The process is described a...

The least-cost method The process is described as follows: Assign as much as possible to the variable with the least unit cost in the whole tableau. (Ties are broken randomly).

Objective function, Objective Function Although the standard LP model c...

Objective Function Although the standard LP model can be either the maximization or the minimization type, it is sometimes useful to convert one form to the other. The maximiz

The more competitive bid, Hornsby Manufacturing has four categories of ove...

Hornsby Manufacturing has four categories of overheads. The four categories and the expected overhead costs for each category for next year are as follows:   Maintenance  $140,000

Draw a time line for the assembly department, Computing equivalents units a...

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

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

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!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd