Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
It refers to the length of time given to the buyer to pay for their purchases. Throughout this period no interest is charged on the excellent amount. The credit period usually varies from 30 to 90 days and in some businesses still a period of 180 days is permitted. If a firm permits 45 days of credit along with no discount for early payment credit terms are stated like 'net 45'. In case the firm permits discount for early payment the credit terms are stated as 1.5/15, net 45' showing that if the payment is made in 15 days a discount of 1.5 % is permitted else the whole amount is to be paid in 45 days.
Raising the credit period results in raised sales but at similar time entails raised investment in debtors and higher incidence of bad debts. Reducing the credit period would have the opposite outcome. The consequence of rising the credit period on net profit can be estimated along with the assist of equation 2.
? NP = [? S (1-V) - ? Sbn] (1- t) - k ? I
In this case ? I computed as:
? I = (ACPn - ACP0) [S0/360] + V(ACPn)( ?S/360)
Here
? I = raise in investments
ACPn = new average collection period
ACP0 = old average collection period
In equation 2a the first term shows incremental investments in receivables related with existing sales and the next term presents the investment in receivables arising out incremental sales.
Minimal Regret Criterion : This method seeks to minimize the maximum regret that would occur from choosing a particular strategy or alternative. The regret is the opportunit
Basic Assumption of Transportation Model The basic assumption of the model is that the transportation cost on a given route is directly proportional to the number of units tran
Procedure of material acquisition A stores record is maintained into which the quantity and value of materials received is entered. Issues of materials to production are made b
Accounts Payable Turnover Ratio is a short-term liquidity measure which is used to calculate the rate at which a company pays off its suppliers. Accounts payable turnover ratio is
Advantages of zero base budgeting 1) it provides a basis for evaluating decision packages on the basis of benefit considerations 2) it reduces inefficiency and achieves high
Debtors turnover ratio( or receivables turnover ratio) Meaning: this ratio establishes a relation ship between net credit sales and averages trade debtors. Objective
Material usage variance Difference among standard quantity of material and actual quantity used is the material usage variance. This variance arises due to: Economic use of
advantages of vertical balance sheet \
LIFE CYCLE COSTING Introduction Life cycle costing as its name implies costs the cost object i.e., product project etc. over its projected life. It is used to explain a s
Explain the cost According to controllability: Controllable cost: this is a cost which can be inclined by the action of a specified member of an undertaking. The organization
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd