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CONTIGENCY THEORY Some researchers have argued that the context in which budgetary control is used is as important as the style in which it is implemented and used. This is ter
Assumptions Underlying the CVP Analysis CVP analysis as discussed above is based on certain assumptions . if these assumptions are not recognized then serious error may result
First Cut Analysis of Costs The allocation of costs and assets will produce a value chain that illustrates graphically the distribution of a firm's costs. It can prove reveali
Illustration: ABC analysis Combine items on the basis of their relative value to form three categories—A, B and C. The data in the table below illustrates the ABC analysis.
Implementing management accounting and control innovations are often problematic. Provide a brief commentary around the key factors necessary to give such innovations the best chan
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
Problem Marginal costing plays a major role in making certain decisions. It provides information to management regarding the behaviour of costs and the incidence of such costs
Pricing is a problem in four general types of situations: 1) When the firm develops or introduces a new product and it is fix the price of the product for the first time. 2)
The advantages and disadvantages of standard costing The benefits for controlling having a standard costing system in operation can be summed up as follows; Cautiously pl
Determine Cost pool and Cost drivers Cost pool: it is another name given to a cost centre and, therefore an activity cost centre may also be termed as an activity cost pool.
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