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POINT ESTIMATE OF PROBABILITIES
This approach requires a number of different values for each of the uncertain variables to be selected. These might be values that are reasonably expected to occur but usually 3 values are chosen. These are as follows:
(A) The worst possible outcome.(B) The most likely outcome.(C) The best possible outcome.
For each of these 3 values, a probability of occurrence will be estimated.
Disadvantages of the cost accounting: 1. It is unnecessary: it is argued that maintenance of the cost records is not necessary and involves duplication of work. It is based o
LIMITATIONS OF ABC ANALYSIS However ABC analysis is a basic tool for exercising selective control over many inventory items, it does not, in its current form, allow precise con
Your manager has informed you that the company is trying to determine if it should use a periodic system or a perpetual system in accounting for the inventory. He wants you to spea
Explain the practical application of differential costing with examples
disadvantages of transfer pricing
Which of the following costs is an example of a cost that remains the same in total as the number of units produced changes?
According to the Philadelphia Inquirer, in 2004 the city of Philadelphia planned to spend $14 million to convert the Convention Center into an appropriate venue for the Republican
Fixed assets turnover ratio Meaning: this ratio establishes a relationship among net sales and fixed assets. Objective: the objective of computing this ratio is to verif
Standard error of estimate (Se) The coefficient of determination r 2 gives us an indication of the reliability of the estimate of total cost based on the regression equation b
Significance points of Variance The following significant points must be kept in mind: Controllability: Controllability should also influence the decision whether t
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