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Budgeting and revenue analysis Student name Institution Course Date The prices of the goods or the services change from time to time. The change is caused by the fluctuations in the demand and the supply of the goods. The production cost of the goods translates to the prices of the goods or service. The external market forces also predict the cost of the services from time to time. The cost to sales revenue ratio is used to indicate whether the company is making profit or loss. The measure is used to compare the financial efficiency of different companies. The cost to sales ratio is also used to analyze the risks and the potential causes of the loss of the company (vankovič, Gordana &Jerman p92). Companies with several business units have to make the decision whether to decentralize or work under central leadership from headquarters. The costs for the company which might make the company not achieve the target ration are the major causes for the uncontrolled growth of the firm. The return on capital employed depends on the risks susceptible in the company. If the capital is invested then the returns should coincide with the target value if the risks are at 0%. The net profit should be at the maximum if the risks involved are reduced to the lowest possible value. The firm and other multinationals should realize that emerging markets are maturing and becoming the engine of growth in the global economy. These areas, however, also pose a challenge for growing businesses in the region so multinationals should grow with caution in order to avoid costly risk (vankovič, Gordana &Jerman p92). Revenues from goods repairs are expected to increase by almost 6
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