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Describe Committed fixed costs
Committed fixed costs are those fixed costs that arise from the possession of
1. Plant, building and equipment (for example, depreciation, rent, taxes, insurance premium etc.) or
2. A basic organization (for example salaries of staff). These costs remain unaffected by any short term changes in the volume of production. Any reduction in committed fixed costs under normal activities of the concern would have adverse on the concern’s long term objectives. Such costs cannot be controlled.
how much is this service?
What the traffic can bear pricing Pricing based on what the traffic can bear is not a sophisticated method. It is used by retail traders as well as by some manufacturing firms.
Economies or Diseconomies of Scale The costs of a value activity are often subject to economies or diseconomies of scale. Economies of scale occur from the capability to perfo
Illustration of Marginal profit To illustrate the computations, suppose that the marginal profit or XE in our model is changed from 3 to 3 + δ1, where δ represents either posit
Your manager has informed you that the company is trying to determine if it should use a periodic system or a perpetual system in accounting for the inventory. He wants you to spea
prepare all budgets
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
Difference between a fixed and flexible budget Fixed budget A fixed budget remains the same irrespective of changed situations. It remains inflexible even if volume of
Engineering method These methods are based on the use of engineering analysis of technological relationship between inputs and outputs e.g. method studies and time and motion s
Saddle Point The saddle point in a payoff matrix is one which is the smallest value in its row and the largest value in its column. It is also termed as equilibrium point in th
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