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CVP ANALYSIS AND COMPUTER APPLICATIONS
The output from a CVP model is only as good as the input. The analysis will include assumptions about sales mix, production efficiency, price loads, total fixed costs, variable costs and selling price per unit.
The CVP equation can be used to develop financial planning programs. These programs quickly calculate the effects of changes in price, costs and volume on an organization’s profits. They result such “what- if” questions as:
Weldon Industrial Gas Corporation supplies acetylene and other compressed gases to industry. Data regarding the store''s operations follow: 500 Garrison, Managerial Accounting, 12t
Explain with examples five areas where linear programming can be applied in Managerial accounting
Characteristics of cost reduction 1) Cost reduction must be real : said through increase in productivity change in product design improvement in technology etc. 2) Cost r
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Classification and computation of variances The computation and analysis of variances is the main aim of standard costing. The variance is the difference among the standard pe
Elements of cost: 1. Material: the substance from which the product is made is known as material it may be in a raw or a manufactured state. It can be direct as well as indir
Transportation model In the obvious sense, the model deals with the determination of a minimum cost plan for transporting a single commodity from a number of sources (e.g. factor
Issa Company manufactures a personal computer designed for use in schools and markets it under its own label. Issa has the capacity to produce 25000 units a year but is currently p
Implementation of the Decisions Once alternative courses of action have been chosen, they must be implemented as part of the budgeting procedure. The budget is a financial plan
Accounting ratios that determine a firm's ability to convert various accounts within their balance sheets into sales or cash. Companies will usually try to shift their productio
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