MUSINGS

Salesmen Training – Individual Methods Individual sales training methods are micro level training from the angle of each salesman. It is highly personalized which involves direct interaction between the trainer and the trainee. This method is most suitable where sales-force to be trained is limited and needs individual intensive attention. There are two such methods namely — on the job training and programmed instruction method. 1. On the job training In this method, the salesman is given the opportunity of observing and performing the selling job of a typical salesman. Keen observation and active participation are two important aspects of learning the job. The trainer observes the performance of the trainee. The trainer corrects him in case of need. This method is also known as  field training method . 2. Programmed instruction method In programmed instruction method, the total subject-matter of training is broken down into chunks called ‘Frames’ — the numbered in...

variance formulas/equations  which can help you calculate variances for direct materials, direct labor, and factory overhead. Direct materials variances formulas Direct labor variances formulas Factory overhead variances formulas Direct Materials Variances: Materials purchase price variance Formula: Materials purchase price variance = (Actual quantity purchased × Actual price) – (Actual quantity purchased × Standard price) Materials price usage variance formula: Materials price usage variance = (Actual quantity used × Actual price) – (Actual quantity used × Standard price) materials quantity/usage variance formula: Materials price usage variance = (Actual quantity used × Standard price) – (Standard quantity allowed × Standard price) Materials mix variance formula: (Actual quantities at individual standard materials costs) –  (Actual quantities at weighted average of standard materials costs) Materials yield variance formula: (Actual quantities at weighted av...

Standard costing is the practice of substituting an expected cost for an actual cost in the accounting records, and then periodically recording variances showing the difference between the expected and actual costs. This approach represents a simplified alternative to cost layering systems, such as the  FIFO  and  LIFO  methods, where large amounts of historical cost information must be maintained for items held in stock. Standard costing involves the creation of estimated (i.e., standard) costs for some or all activities within a company. The core reason for using standard costs is that there are a number of applications where it is too time-consuming to collect actual costs, so standard costs are used as a close approximation to actual costs. Since standard costs are usually slightly different from actual costs, the  cost accountant  periodically calculates variances that break out differences caused by such factors as labor rate changes and the cos...

NEW PRODUCT PRICING – PRICE SKIMMING OR PENETRATION PRICING? – PRICING IN THE INTRODUCTION STAGE Price-Skimming – New Product Pricing The first new product pricing strategies is called price-skimming. It is also referred to as market-skimming pricing. Price-skimming (or market-skimming) calls for setting a high price for a new product to skim maximum revenues layer by layer from those segments willing to pay the high price. This means that the company lowers the price stepwise to skim maximum profit from each segment. As a result of this new product pricing strategy, the company makes fewer but more profitable sales. Many companies inventing new products set high initial prices in order to skim revenues layer by layer from the market. An example for a company using this new product pricing strategy is Apple. When it introduced the first iPhone, its initial price was rather high for a phone. The phones were, consequently, only purchased by customers who really wanted the new ga...