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Choose the relationship which best predicts the dependent variable
After exploring a diversity of relationships, you should select the one that can best be employed in predicting the dependent variable. Generally, this will be the relationship which best predicts the values of the dependent variable. The high correlation (relationship) among a potential independent variable and the dependent variable frequently indicates that the independent variable will be a good predictive tool. Though, you should reassure that the value of the independent variable is accessible in order for you to make timely estimates. When it is not, you might require considering other alternatives.
There are different techniques which can be used to estimate the cost function. Examples comprise: • Engineering technique• Account analysis• Regression analysis• High low technique• Time series analysis• Simulation analysis
Steps of Graphic Analysis There are four steps in using graph paper to study cost-volume relationships: Step 1: Compute the scale which you will use: Volume is considered
Extensions to Linear Programming In many real situations the solutions to linear programming models make sense only if they have integer values. Rounding off the linear programmi
In this scheme, non-revolving line of credit is extended to the seller to be utilized inside a stipulated period. Assistance is provided to manufactures for promoting sale of their
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Let a quarry's cost function of producing Q tons of stone per hour be given by TC = Q 3 - 10Q 2 + 40Q + 25, so that marginal cost function is MC= 3Q 2 - 20Q + 40. (i) Find th
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Correlation coefficient (r) Correlation coefficient measures the degree of association between two variables such as the cost and the activity level. r = nΣxy - Σx Σy
Determine the Scope and areas of cost reduction Scope and areas of cost reduction the scope of cost reduction is so wide that it is not practicable to develop fully the areas i
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Steps of choosing an accounting based performance measure Consider the overall goal of the organization as a whole. It is important to choose a measure of accomplishment that r
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