Kế toán, kiểm toán - Chapter 14: Decision making: Relevant costs and benefits

Decision Making: Relevant Costs and BenefitsChapter 14The Managerial Accountant’s Role in Decision MakingDesigns and implementsaccounting informationsystemCross-functional management teams who makeproduction, marketing,and finance decisionsMake substantiveeconomic decisionsaffecting operationsManagerialAccountantThe Decision-Making Process1. Clarify the Decision Problem2. Specify the Criterion3. Identify the Alternatives4. Develop a Decision Model5. Collect the Data6. Make a DecisionQuantitativeAnalysisThe Decision-Making Process1. Clarify the Decision Problem2. Specify the Criterion3. Identify the Alternatives4. Develop a Decision Model5. Collect the Data6. Make a DecisionPrimarily theresponsibility of themanagerialaccountant.Information should be:1. Relevant2. Accurate3. TimelyThe Decision-Making Process1. Clarify the Decision Problem2. Specify the Criterion3. Identify the Alternatives4. Develop a Decision Model5. Collect the Data6. Make a DecisionQualitativeConsiderationsThe Decision-Making Process1. Clarify the Decision Problem2. Specify the Criterion3. Identify the Alternatives4. Develop a Decision Model5. Collect the Data6. Make a DecisionRelevantPertinent to a decision problem.AccurateInformation mustbe precise.TimelyAvailable in timefor a decisionRelevant InformationInformation is relevant to a decision problem when . . .It has a bearing on the future, It differs among competing alternatives.Identifying RelevantCosts and BenefitsSunk costsCosts that have already been incurred. They do not affect any future cost and cannot be changed by any current or future action.Sunk costs are irrelevant to decisions.Analysis of Special DecisionsThe Text Book takes you through some special decisions faced by many businesses:Accept or Reject a special orderOutsource a Product or ServiceAdd or Drop a Service, Product or DepartmentSpecial Decisions in Manufacturing Decisions Involving Limited ResourcesOther Issues in Decision MakingIncentives forDecision MakersShort-RunVersusLong-RunDecisionsOther Issues in Decision MakingPitfalls to AvoidSunkcosts.Unitizedfixed costs.Allocatedfixed costs.Opportunitycosts.End of Chapter 14