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Exact management of receivables acquires a suitable collection policy that outlines the collection procedures. Collection policy consider as the procedure adopted through a firm to
Explain Profitability ratios in relation to sales a) Gross profit ratio b) Net profit ratio c) Operating ratio d) Operating profit ratio e) Expenses ratio
Competition oriented pricing policy Most companies fix the price of their products after a careful consideration of the competitor's price structure. Deliberate policy may be f
How costs behave as the level of activity/volume changes. Why an understanding of cost behaviour is important ? Types Variable e.g. petrol, direct materials Fixed e.g.
What are Direct expanses These are expanses which can be directly, conveniently and wholly allocated to a specific cost centres or cost units examples of such expanses are hir
Transition probabilities These are the probabilities of moving from one state to another in the next time period. Usually they are written in the form of a probability matrix.
One of the significant elements of credit management is the assessment of the credit risk of the customer. As assessing risk two kind of errors arise that are as follows. Type
State Material price variance Difference among standard price and the actual price of the material is the material price variance. This variance arises because of various facto
Characteristics of standard costing 1) Flow of information : in a standard costing system cost information flows in a straight forward manner as material is requisitioned and
Material storage Sophisticated mathematical models to control economic buying, and systems control the flow of material may all be for naught if the obvious-efficient storekeep
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