ACCOUNT-CLASSIFICATION METHOD Definition

ACCOUNT-CLASSIFICATION METHOD, also called account analysis, is a cost estimation method that requires a study of an account in the general ledger. The experienced analysts use the account information as well as their own judgment to determine how costs will behave in the future.

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DEFICIT BUDGET is where the estimates of expenses are greater than estimates of revenue.

CONSIGNMENT is when goods are offered for sale on behalf of another without the seller actually purchasing or taking title to the goods. Only when there is a subsequent sale does the owner receive any payment.

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