Explain how probability analysis could be used to assess the risk of the evaluated projects.
Select all the true statements.
THS produces two products from different combinations of the same resources. Details of the products are shown below:
Identify, using graphical linear programming, the optimal production plan for products E and R to maximize THS's profit in the month.
Explain THREE benefits that organizations gain from using budgetary planning and control systems.
Select ALL the true statements.
CH is a building supplies company that sells products to trade and private customers.
Budget data for each of the six months to March are given below:
80% of the value of credit sales is received in the month after sale, 10% two months after sale and 8% three months after sale. The balance is written off as a bad debt.
75% of the value of credit purchases is paid in the month after purchase and the remaining 25% is paid two months after purchase.
All other operating costs are paid in the month they are incurred.
CH has placed an order for four new forklift trucks that will cost $25,000 each. The scheduled payment date is in February.
The cash balance at 1 January is estimated to be $15,000.
Prepare a cash budget for each of the THREE months of January, February and March.
Select All the correct answers.
PL currently earns an annual contribution of $2,880,000 from the sale of 90,000 units of product B. Fixed costs are $800,000 per annum.
The management of PL is considering reducing the selling price per unit to $48. The estimated levels of demand at the revised selling price and the probabilities of them occurring are as follows:
Calculate the probability that the profit will increase from its current level if the selling price is reduced to $48.