After reading this article you will learn about:- 1. Introduction to Equipment Replacement Analysis 2. Reasons for Replacement of Equipment 3. Policy 4. Guidelines 5. Hire-Purchasing. Introduction to Equipment Replacement Analysis: Equipment replacement decision plays an important role in the economic running of any concern for years or decades. A firm has to face three types of replacement decisions: (a) [...]
After reading this article you will learn about the calculation of various overheads:- 1. Obsolescence 2. Interest on Capital 3. Idleness 4. Repairs and Maintenance. Obsolescence: Suppose a factory owner purchases a machine for his production shop but after some duration a better machine comes in the market, whose production rate is very high and is much economical. Although the [...]
This article throws light upon the three types of indirect expenses. The types are: 1. Factory Expenses 2. Administrative Expenses 3. Selling and Distribution Expenses. Type # 1. Factory Expenses: These overheads include all indirect expenses incurred during production, e.g., from the receipt of order until the product is complete and ready to dispatch. Factory expenses are also termed as [...]