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Discretionary fixed costs and Semi variable costs
Discretionary fixed costs are those which are incurred as a result of management discretion. These costs have two important features viz.
They arise from periodic (usually yearly) decisions regarding the maximum outlay to be incurred, and they are not tied to a clear cause and effect relationship b/w inputs and outputs. For examples of discretionary fixed costs includes advertising public relations, executives training, teaching, research, health care etc. these costs are controllable.
Semi variable costs: those costs which are partly fixed and partly variable are called semi variable costs. These costs are very with the level of production but not in direct proportion to the level of production. The examples of such costs are depreciation of machinery, maintenance of equipment, administrative costs, etc.
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
Features of product life cycle costing Product life cycle costing is important due to the following features: 1) product life cycle costing involves tracing of costs and re
underlying assumptions of breakeven analysis and the limitations of this.
Explain the terms - Cost object and Activities Cost object : it is an item for which cost measurement is required for example a product or a customer. Activities: these c
Gardner Manufacturing Company produces a product that sells for $120. A selling commission of 10% of the selling price is paid on each unit sold. Variable manufacturing costs are $
You want to purchase a house that costs $325,000. You have a down payment of $65,000 and will take out a mortgage to make up the difference. The AMC Mortgage Corporation offers a q
Kent Company had 800 units of product in its assembly department's work in process inventory at the starting of the period. During the period 3,000 additional units of product were
Prepare Summary Journal Entries to record the( 1) requistion slips
EMERALD LTD is planning an expansion programme,which will require Rs 30 crores & can be funded through one of the following 1.issue further equity share of Rs 100 each at par.
Lock Box System: In this type of system, the customers are advised to mail their payments to a post office box hired through the firm for collection purposes near their region. T
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