building your own Monte Carlo simulations applied to a wide range of business problems, including the construction of short-term profit plans (otherwise referred to as “Cost-Volume-Profit” models, covered in Chapter 9 of the text). Monte Carlo refers to a widely used approach for solving complex problems using computer algorithms to simulate the variables in the model (e.g., a CVP model). Typically, an algorithm is developed to "model" the problem, and then the algorithm is run many times (from a few hundred
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Selling Price per Unit | $19.00 | | Direct Material Cost per Unit | $3.50 | | Direct Labor Cost per Unit | $1.40 | | Variable Selling Costs per Unit | $1.20 | | Fixed Manufacturing Costs | $1,600,000 | | Fixed Selling & Administrative Costs | $1,200,000 | | | | | | | | Absorption (GAAP) Income | | | | | Revenues (Sales) | | $6,555,000 | Cost of Goods Sold (Cost of Sales) | | 3,070,500 | Gross Profit (Gross Margin) | | $3,484,500 | Selling & Administrative
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One secret to maintaining a thriving business is recognizing when it needs a fundamental change. 50 Harvard Business Review 1711 Johnson.indd 50 | December 2008 | hbr.org 10/30/08 2:02:02 PM Reinventing Y our Business Model by Mark W. Johnson, Clayton M. Christensen, and Henning Kagermann Jim Frazier IN 2003, APPLE INTRODUCED THE IPOD WITH THE ITUNES STORE, revolutionizing portable entertainment, creating a new market, and transforming the company. In
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fundamentals of cost accounting fourth edition William N. Lanen Shannon W. anderson Michael W. Maher ® accounting The integrated solutions for Lanen/Anderson/Maher’s Fundamentals of Cost Accounting, 4e have been proven to help you achieve your course goals of improving student readiness, enhancing student engagement, and increasing their comprehension of content. Known for its clear and engaging style, the Lanen solution employs the use of real-world scenarios, LearnSmart, and instant
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Running head: Competition Bikes, Financial Analysis RJET Task 4 Sacha B.R. Almanza Student ID: 000280685 Program & Start Date: M.B.A. Health Care Management; 10.02.2012 Western Governor’s University Running head: Competition Bikes, Financial Analysis A1. Costing Method The purpose of the following Executive Summary is to illustrate Competition Bikes Inc.’s need to alter our current costing method by utilizing the activity based costing (ABC) method. Traditional based costing (TBC) is a
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activities • Decision making • Optimising the uses of resources Key Definitions a) Cost unit- the cost of an item a product or service. This could be a single item, a batch, a contract what ever is appropriate for the organisation. b) Cost classification - to group costs for analysis and control purposes c) Cost centre - a function or location for which costs are ascertained dividing into production (primary) and service (secondary) areas. 1. THE
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Absorption Costing Absorption costing is a costing system in which the direct labor, direct materials, and fixed and variable manufacturing overhead costs are traced to every finished product. Thus, in the absorption costing system, all costs are product costs regardless of their classification of variable or fixed. Because of its characteristic of no cost discrimination, absorption costing is also known as full costing or as full absorption method (¨Absorption¨ 1). The absorption costing is the only
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called distributes manufacturing overhead costs to products in a smarter way than in the traditional way. This way of simply assigning costs on the basis of machine hours. Activity based costing assigns costs first to the activities that make up the real overhead. Then it assigns a cost to the activities that affect only the products produce. ABC vs Traditional Costing This is one main difference between ABC (Activity Based Costing) and TCA (Traditional Cost Accounting) it is Activity Based Costing
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CHAPTER 19 Cost-Volume-Profit Analysis: Additional Issues ASSIGNMENT CLASSIFICATION TABLE Brief Exercises 1, 2, 3, 4, 5, 6 A Problems 1A, 2A B Problems 1B, 2B Study Objectives 1. Describe the essential features of a cost-volume-profit income statement. Apply basic CVP concepts. Questions 1, 2, 3, 4 Do It! 1 Exercises 2. 2, 4, 5, 6 1, 2, 3, 4, 5, 6 7, 8, 9, 10 11, 15 2 1, 2, 3, 4, 5 6, 7, 8, 9, 10 11, 12, 13 1A, 2A, 4A, 6A 4A 1B, 2B, 4B, 6B 4B 3. Explain the
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|CLP |Text |Worked Example/Activity Ref | | | | | | |What is it? Provision of info financial and non-financial to decisions makers usually in|Pg 9 | |Activity 1 - the role of the| |the organisation | |
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