Determining The Following Before Deciding A Prescription

3. Explain two methods that can be used in order to identify realistic estimations when developing a budget. [2.2]

c. If we buy machine 3 because it's a bottleneck, without changing anything else, utilization for station 3 will become less which will cause less queue, less waiting time, less lead time, no or less penalty, more revenue.

c. Explain how the location of each curve graphed in question 7b would be altered if (1) total fixed cost had been $100

Trade-offs are often seen within the three types of costs listed above. Sometimes we must choose to spend our budget more heavily on appraisal costs so that we can try to

Calculate how much each system will cost per year and determine which of the quotes is most cost-effective.

Model Description The model takes much of the busywork out of the case, enabling students to spend more time on interpretation and evaluation. Like most case models, the student and instructor versions differ only in regard to the input data. The instructor’s version contains the complete base case inputs, while these inputs are zeroed out in the student version of the model. The model for this case takes the input data (cost pool values and allocation rates) and allocates overhead costs from the three overhead departments to the three patient services departments using all four allocation methods. Additionally, the model calculates the profitability of each patient services department under each allocation method. The model’s (instructor’s version) Input Data and Key Output sections are as follows:

Question "In order to determine whether user charges are commensurate with operating costs, it is desirable for internal service fund operations

3. For each of the individual overhead accounts at Bridgeton, do you believe the given cost is variable, fixed, or something else? Why? (Use information or evidence from the case to support your evaluation, if possible. For most of these costs, there is no single right answer from the case information, so the goal is to come up with a reasonable estimate.)

In line with our objective, we proposed two different models both resulted in reducing the total cost. Proposed scenarios are:

The cost of implementation of the options: It deals with the technicians and the reduction in time of implementation. This leads to better customer service and increases efficiency of the technicians. Also considering a customer base reduction of 5% (Exhibit 2), $1 million dollars will be a prudent investment.

a. Investigate the original calculation of Setup Cost (denoted by “S” in the case), is there

4. During which month of the project are the highest and lowest costs expected to

For instance, the concept of cost estimation which assists in estimating future expenditure as the expenditure depends on the cost of the respective activities can be applied in the setting of a budget which is simply an estimate and schedule of all costs required to be assigned to an activity. One can make an estimation of the resources required for an activity by applying the cost estimation techniques. Since there are limiting factors to each activity such as scarcity of resources for activities, the concept of constraints can be applied together with the concept of cost volume profit analysis to ensure that maximum benefits are driven from the scarce resources and the number of activities that are available. This facilitates the allocation of resources that most equitable and profitable. The theory of constraints is also applicable in the process of setting up budgets. In setting up budget one considers the amount of resources that are available and cannot therefore set a budget plan that exceeds the amount of resources that are available. This implies that the budget is constrained by the amount of

The ABC system will help management analyse the profitability of each customer and restore the profitability of the company. Allied needs to offer benefits such as modified compensation plan focused on growing customer revenue and profitability to help encourage sales behaviour. TFC is able to significantly improve profits by concentrating on individual account management which SBP is capable of by identifying service costs and calculate the contribution for each account and then rank the accounts according to profitable ones. TFC should charge its customers based on their service usage by using cost plus pricing. The customers would be charged based on the cost of product plus service charge based on SBP systems plus a mark-up so that it will be fair to customers that have the same sales but different level of service.

The first step in Cellini and Kee's framework is to determine if the analysis will be cost-benefit or cost-effectiveness. Cost benefit analysis is considered by the authors to be the superior technique (p.496) so that is what will be used. The