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Business entities are going through tough times due to the prevailing economic situation. As a management accounting student, you should have adequate understanding on how such businesses should deal with their costs. Below are possible approaches that business should focus on as they target reduction of the costs;
1. Breakeven Analysis
2. Relevant Range Analysis
3. Total Cost Analysis
4. Waste Analysis
5. Process Analysis
Required
Problem a. Evaluate how each of the above approaches can be used to reduce costs in manufacturing companies in Kenya.
Problem b. Explain the cost reduction priorities that should guide you as you implement the cost reduction strategies.
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