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Control ratios: Three important ratios are usually used by the management to find out whether the variations from budgeted results are unfavorable or favorable. These ratios are expressed as percentages and any ratio beyond 100% is favorable and an ratio less than 100% is unfavorable. The three ratios are:
a) Activity Ratio: this ratio is a measure of the level of activity attained over a period.
b) Capacity Ratio: capacity ratio specifies whether and to what extent budgeted hours of activity are actually utilized..
c) Efficiency Ratio: Efficiency ratio specifies the degree of efficiency attained in production.
Q. Define the Cash Budget? Cash Budget: - A cash budget is an estimation of cash receipts and cash payments for a future period of time. It is prepared to predict the cash requ
It is a trust developed by a married couple with the purpose of minimizing estate taxes. An A-B trust is a trust that splits into two on the death of the first spouse. It is produc
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Define the role of cash and of earnings while a corporation is deciding how much, if any, cash dividends to pay to common stockholders. In the long-run earnings are essential to
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Assume that you hold a piece of land in the City of London that you may wish to sell in one year. Like a U.S. resident, we are concerned along with the dollar value of the land. Su
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