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C-V-P ANALYSIS UNDER UNCERTAINTY
A major limitation of the basic C.V.P analysis is the assumption that the unit variable cost, selling price and the fixed costs are constant and can be predicted with certainty. These factors however are variables with expected values and standard deviations that can be estimated by management.
There are different ways of dealing with uncertainty. Examples comprise:
ABC Analysis (Pareto Analysis) In ordinary parlance, ABC analysis can be best compared with our class society where the population is categorized into Top, Middle and Lower cla
Open Account Credit sales are usually on open account that implies which the seller ships the goods to the buyer and afterward sends the bill invoice. Consignment In th
Explain Activities uses through activities based costing In order to correctly associate costs with products and services. ABC assigns cost to activities based on their use of
Coleman, a married taxpayer, is going to establish a manufacturing business. He anticipates that the business will be profitable immediately due to a patent he holds. He predicts t
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SSI, a meat/burger/chicken processing manufacturing plant loacted in Idaho, USA prepares
Write a response to your boss, the controller. The response should be 2-5 pages in length (double-space). Your response to the controller should include, but not be limited to, t
Illustration of Graphic Analysis The four steps of cost-volume-profit analysis can be employed to graph and study any cost-volume relationship. Suppose that you have been aske
Sources of Working Capital Finance Working capital finance may be classified in the subsequent: Spontaneous Source of Finance Finance that naturally arises in
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