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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.
Incremental budgeting This is used to describe an incremental cost approach to budgeting where the next period budget is based on the current year’s results plus an extra amou
C-V-P ANALYSIS – MULTIPLE PRODUCTS The simple product CVP analysis can be extended to handle the more realistic situations where the firm produces more than one product. The o
stanley shoe company established a line credit with a local bank. the maximum amount that can be borrowed under the terms of the agreement is $100000 at an annual rate of 12%. a co
Assumptions for relevant costs The key assumptions made in relevant costing are: The cost behavior is recognized. The amount of fixed costs, unit variable costs, selli
Profitability ratios The primary objective of a business under taking is to earn profits. Profit earning is considered necessary for the survival of the business. A business re
School problem is asking to calculate the work in progress inventory for the beginning of a month without providing previous month data.
The subsequent short-term investment opportunities are obtainable to companies in India to invest their temporary cash excess. a) Treasury Bills: Treasury Bills are short-term
SSI, a meat/burger/chicken processing manufacturing plant loacted in Idaho, USA prepares
What is period cost Period costs are those costs which are reported as expanses of the period in question. These are cost which are not assigned to the product but are charged
State performance budgeting according to carter performance According to carter performance budgets use statement of mission goals and objectives to explain why the money is be
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