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Explain the main purpose of cost centre The main purpose of cost centre is two fields. 1. Recovery of cost: costs are collected, classified into two field in respect of
Objectives of ratio analysis 1) Measuring the profitability: we can measure the profitability of the business by calculation gross profit net profit expenses ratio and other.
Credit Limit A credit restriction is the maximum amount of credit that the firm will extend at a point of time. This indicates the extent of risk taken through the firm through
VALUE CHAIN ANALYSIS Every firm is a collection of activities that are executed to design, generate, market, deliver and support its products or services. Value chain analysis
Explain Out of pocket cost A cost which will have to be paid to outsides as against cross such as depreciation, which do not require any cash payment this cost is relevant in t
State the Penetration pricing As opposed to the skimming pricing the objective of penetration pricing is to gain a foothold in a highly competitive market. The objective of thi
Cost oriental pricing policy Cost of production of a product is the most important variable and most important determinant of its price. There may type of costs such as-fixe
Implementation of ABC analysis The following steps are included in implementing the ABC analysis: 1. Categorize the items of inventories, establishing the expected use in un
Importance of a budget A Budget is a plan expressed in monetary terms. It is prepared prior to the budget period and may show income, expenses and the capital to be used i.e. a
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