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Laplace Criterion of Rationality This criterion holds that if decision makers do not know the probabilities of the various states of nature and have no reason to think otherwis
How costs behave as the level of activity/volume changes. Why an understanding of cost behaviour is important ? Types Variable e.g. petrol, direct materials Fixed e.g.
Disadvantages of the cost accounting: 1. It is unnecessary: it is argued that maintenance of the cost records is not necessary and involves duplication of work. It is based o
Application of Transportation Model In the direct logic, the transportation model looks for the determination of a transportation plan of a particular commodity from a number o
Recommend whether marginal or absorption costing should be use for internal monthly reporting
CONTINUOUS PROBABILITY DISTRIBUTION (USE OF NORMAL DISTRIBUTION) In reality the C-V-P variables might take any values in a continuous range. It could therefore be more appropriat
Exercises 2-1, 2-2, 2-3, 2-4 Problem 2-14 I didn’t write every question down out of the book just questions 2-1, and 2-2. Exercise 2-1 classifying manufacturing cost. Your boat,
SENSITIVITY ANALYSIS OF EOQ MODEL Sensitivity Analysis is regarded with the manner in which those results of solutions change in response to change in model parameters.
Illustration of Graphic Analysis The four steps of cost-volume-profit analysis can be employed to graph and study any cost-volume relationship. Suppose that you have been aske
Non-zero lead time (determining reorder point) This basic EOQ model assumes that the suppliers lead time is zero (i.e. goods are delivered immediately on the day the order was
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