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Purpose of Cost Estimation
In estimating it assists the future expenditure as cost prediction like the expenditure will depend upon the cost of the respective activities
a) In determining it assists the total benefits anticipated in a exact activity based on the relationship between projected revenue and projected costs.
Cost estimation is helpful in business cost control, planning and decision making performance evaluation.
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Methods Required To Allocate Joint Costs 1) Physical/Unit Measure 2) Constant gross margin rate 3) Net realizable value.
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