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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.
Logan Products computes its predetermined overhead rate annually on the basis of direct labor hours. At the beginning of the year, it estimated that 39,000 direct labor-hours would
Assumption of break even analysis The break even analysis is based upon the following assumptions : 1) All elements of cost, i.e., production , administration and selling di
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
Learning and Spillovers The cost of a value activity can decline over time due to learning that increases its efficiency. The methods by which learning can lower cost over tim
Explain the Features of budgetary control From the definition the following features of budgets control emerge: 1) Establishment of budgets: budgets are prepared for each
identify and explain the many classification of costs for planning, control.performance evaluation and decision making.
What is Activity ratio Funds are invested in several assets in business to make sales and earn profits. The efficiency with which assets are managed directly affects the volume
It is a spontaneous source of finance that is commonly extended to business organization depending on the custom of the competition and trade prevailing within the organization and
Describe the method of drawing a break even chart. 1) volume of production/output or sales is plotted on horizontal axis , i. e y - axis . the volume of sales or production ma
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