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Testing the Slope
The strong point of the relationship among the dependent variable and each of the independent variables can be determined using 3 methods:
1) Correlation coefficient (r): Correlation coefficient measures the degree of association between two variables such as the cost and the activity level.2) Standard error of the slope (Sb): Correlation coefficient measures the degree of association between two variables such as the cost and the activity level.3) Z or t statistics:
If n ≥30 we use Z, if, n < 30 we use t statistics. These statistics can be used to test the hypothesis:
Ho: B = O that is, there is no relationship between X and YHA: B≠ O There is a significant relationship between X and Y
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.
Logan Products computes its predetermined overhead rate annually on the basis of direct labor hours. At the beginning of the year, it estimated that 39,000 direct labor-hours would
Explain Out of pocket cost A cost which will have to be paid to outsides as against cross such as depreciation, which do not require any cash payment this cost is relevant in t
Transportation model Table A more compact method for representing the transportation model than the linear equations is to use what we call the transportation tableau. It is a
contribution margin
Hoe to find the cost of goods transferred under weighted average method
Explains how activity –based techniques can be used to improve performance
7 feed from control to planning It is realized these days more than even before that management control is primarily a human activity which should focus on how to help individu
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INVENTORY PLANNING AND CONTROL The main goal of "inventory control" is to discover and maintain the optimum level of investment in all types of inventories, from raw materials
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