ACCO 330 - Profit planning

ACCO 330 - Profit planning - ACCO 330 Cost Accounting...

Info iconThis preview shows pages 1–5. Sign up to view the full content.

View Full Document Right Arrow Icon
ACCO 330 – Cost Accounting Profit Planning 1 Profit Planning – Short-Term Decisions
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
ACCO 330 – Cost Accounting Profit Planning 2 1. Short-Term decisions A. Framework The relevant costs are those that will differ between two alternatives course of action. Most significant relevant costs are the variable costs of the alternative actions Must consider fixed costs potential diseconomies of scale A firm expansion in new product segments may increase the fixed cost of certain activities (planning, coordination, warehouse logistics, etc.)
Background image of page 2
ACCO 330 – Cost Accounting Profit Planning 3 1. Short-Term decisions B. Evaluating a special order Must consider the behaviour of the firm’s costs If the order means a reduced selling price; management must estimate the potential impact the reduced price on the existing customers
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
ACCO 330 – Cost Accounting Profit Planning 4 1. Short-Term decisions C. Make-or buy decisions Must consider only the relevant costs Ignore the sunk costs – incurred in the past and cannot
Background image of page 4
Image of page 5
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 01/24/2011 for the course ACCO 330 taught by Professor Mastromonaco during the Fall '10 term at Concordia Canada.

Page1 / 9

ACCO 330 - Profit planning - ACCO 330 Cost Accounting...

This preview shows document pages 1 - 5. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online