The Fixed Period

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    the difference between budgeted fixed overhead cost and applied fixed overhead cost. D. the difference between budgeted fixed overhead cost and standard fixed overhead cost. 26. A weakness of flexible budgets is that? A. they are geared only to a single level of activity. B. they give subordinates too much flexibility. C. they force the manager

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    conceived before the period in question begins" (Investopedia, 2012). This concept will be contrasted with a flexible budget. This technique allows for the values of inputs and outputs to be changed at any point, or at multiple points, during the period in question. The company would normally make such a change whenever it is realized that the change is needed. A new price from a supplier, for example, could be reflected immediately in a flexible budget, rather than at the end of the period. This and other

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    product costs can be incurred in one, when goods are manufactured, and recognized in another period, when goods are sold. The absorption costing method identifies the importance of fixed costs involved in production, which is accepted by Inland Revenue as stock is not undervalued. It also shows less fluctuation in net profits in case of constant production but fluctuating sales. However, treating fixed manufacturing overhead as variable cost may lead to faulty pricing decisions and keep-or-drop

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    Financial ratios are a good way to assess the performance of your business and identify potential problems. The ratios are used to measure factors such as profitability, solvency, efficiency, and debt load of your business. Financial ratios are used by company financial situation and also how this company is performing. Commercial ratios are meters of a making mercantile assignment and moreover how this company is performing. Unexcelled productive ratios are deduced confer with from an everlasting

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    Headgear Inc Case Study

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    000 units in 2003, the use of absorption costing allowed the per unit fixed manufacturing overhead cost to decrease in 2003 as compared to 2002. The following shows the comparison between using absorption and variable costing models when calculating the total cost of sales and the operating income. | | Because the absorption-costing model only deducts the fixed manufacturing overhead costs for units sold in the current period, the COO was able to show an increase in profits between 2002 and 2003

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    Floating or Fixed Rate Home Loan? Which Loan Type Will Work for You? By Anindita Mukherji | Submitted On May 01, 2014 Recommend Article Article Comments Print Article Share this article on Facebook Share this article on Twitter Share this article on Google+ Share this article on Linkedin Share this article on StumbleUpon Share this article on Delicious Share this article on Digg Share this article on Reddit Share this article on Pinterest Buying a property is one of the biggest investment

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    Marginal Costing

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    Before a firm can make a profit in any period, it must first of all cover its fixed costs. MARGINAL AND ABSORPTION COSTING 1 9 8 COST ACCS T U D Y T E X T Suppose that a firm makes and sells a single product that has a marginal cost of Shs.25 per unit and that sells for Shs.40 per unit. For every additional

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    Basic Cost Concepts

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    important for decision makers. ➢ Irrelevant cost is cost which is not affected by a decision, i.e. it will be the same regardless of the choice that is made. 5. Shutdown and sunk costs – ➢ Shutdown costs – costs of idle plant during the period of temporary suspension of operations. ➢ Sunk costs – historical or past costs, which have been created by a decision that was made in the past that cannot be changed by any decision that will be made in the future 6. Controllable and uncontrollable

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    adjustable and fixed interest rate mortgages. Before discussing the benefits and pitfalls of each mortgage type, let's recap their primary differences. A fixed rate mortgage is a mortgage where the rate and the monthly mortgage payments are fixed to a specific amount for the entire life of the loan. An adjustable rate mortgage, also known as an ARM, however, is a mortgage where the rate can fluctuate throughout the life of the loan. Because the rate in an ARM can change, the monthly

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    the finished product will have different effects on profit margins as reported on the income statement. Absorption costing does not support CVP analysis because it essentially treats fixed manufacturing overhear as a variable cost by assigning a per unit amount of the fixed overhead to each unit production. Treating fixed manufacturing overhear as a variable cost can, lead to faulty pricing decisions and keep-or-drop decisions, and produce positive net operating income even when the number of units

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