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Engineering Method of Cost Estimation
This method is based on a detailed study of each operation whereas careful requirement is made for materials, labour and equipment essential to produce a product. It includes identifying the level of input desired of an activity in form of raw material and labour whereas net cost is based upon the cost of all input. This approach is applicable whereas no past data exists. The major setback of the approach is such it needs a complex analysis of all the constituents of an activity and the necessities of an activity in terms of costs detailed into labour, materials, time and overheads.
Requirement for additional Funds A business would require additional capital for two purposes: 1. Financing additional fixed assets, and
A provision must be made in advance for those debts whose recovery is uncertain and to writing off bad debts. Each enterprise, depends on their past experience, make a provision fo
Alger Corp wants to buy some construction equipment for $50,000, which has a useful life of 4 years with no salvage value. Alger uses straight-line depreciation. Alger has a tax ra
concepts of cost
Which of the four types of costs would include Direct Labor? A. Unit-Level B. Batch-Level C. Product Sustaining D. None of the above
Inventory Management and Control Here the objectives of inventory management are as: 1. To ensure adequate stocks to permit for continuous production/operations, and
GZ Inc. manufactures two products that require both machine processing and labor operations. Although there is unlimited demand for both products, GZ could devote all its capacitie
Usefulness of Variance Analysis Carefully note that while prices are being charged to production, it can be done at the actual or standard price. For purposes of making varian
Moore Corporation follows a policy of a 10% depreciation charge per year on all machinery and a 5% depreciation charge per year on buildings (the corporation uses the nearest full
Seventeen new bathing suit stores enter the Santa Barbara market, joining the seven that already existed. As a consequence, the demand schedule facing Swim N Style (and all other s
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