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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.
C-V-P ANALYSIS UNDER UNCERTAINTY A major limitation of the basic C.V.P analysis is the assumption that the unit variable cost, selling price and the fixed costs are constant an
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
what is the topic about? what are the practical implications? what are the practical criticisms?
Explain the Scope of cost accounting Scope of cost accounting: the scope of cost accounting is very wide and includes the following: 1 cost ascertainment: it deals with t
Participative Budgets In this approach to budgeting, budgets are developed by lower level managers who then submit them to their superiors. The budgets depend on the lower level
When the stock market is going up over a long period of time, investors can become complacent about the risks of being a stockholder. After the significant decline of the stock mar
prepare all budgets
Financial Accounting Which is concerned with the provision of information to external parties outside the organization? It is the procedure of measuring, classifying, summariz
Cost comprise impact Some of the policy choices which tend to have the maximum impact on cost comprise: Product performance, configuration, and characteristics Mix and
Planning Planning is the fundamental function of the management by means of which the managers decide: What goals are to be accomplished How they will be accomplished.
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