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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:
Ranking of Decision Packages The ranking procedure is employed to establish a rank priority of decision packages in the organization. Throughout the ranking procedure managers
Disadvantages of the cost accounting: 1. It is unnecessary: it is argued that maintenance of the cost records is not necessary and involves duplication of work. It is based o
Q. Show process of Pricing under decline stage? In this stage the producer should follow the pricing strategy which may fetch revenue not less than its cost of production. If h
Full Service Recourse Factoring : In this kind of factoring the client has to bear the risk of default made through the debtors. There the factor had advanced funds against book de
Standard error of estimate (Se) The coefficient of determination r 2 gives us an indication of the reliability of the estimate of total cost based on the regression equation b
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BENCH MARKING In the current business environment, organizations are under a lot of pressure to improve performance and that of their divisions or subsidiaries. Bench marking i
What is Budgetary control Budgetary control is the process of determining various budgeted figures for the enterprises for the future period and then comparing the budgeted fi
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 (or select) the dependent variable (Y) Will the CER be employed to estimate price, labor hours, cost, material cost, or some other measure of cost? Will the CER be employ
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