- Cost Behaviour:Importance for decision making. Linear and non-linear cost behaviour patterns. Approaches to estimating cost functions, including statistical and non-statistical approaches. The learning curve, including the learning curve formula.
- Decision Making in its Organisational Context:Models of the decision-making process. The role of accounting information in the decision-making process. Types of decisions in manufacturing, service and not-for-profit organisations.
- Relevant Cost Analysis:Relevant and irrelevant costs, opportunity costs, sunk costs. Marginal costing in the management decision process. Preparation and interpretation of information for specific types of decisions. Limiting factors and the application of linear programming, preparation of information using the graphical approach, interpretation of information using the simplex approach. Theory of constraints. External pricing strategies and decisions: cost-based, market-based, special orders. Qualitative factors in decision making.
- Uncertainty and Decision Making:The role of decision models. Sensitivity, decision-tree and probability analyses. Expected monetary value and utility value. Buying perfect and imperfect information.
- Decentralisation and Performance Evaluation:Reasons for decentralisation. Cost centres, profit centres and investment centres. Measurement of divisional performance, strengths and weaknesses of various measures. Transfer pricing, principles, alternative systems, role of accounting information. International transfer pricing.
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Garrison, RH, Noreen, EW and Seal, W, Management Accounting, McGraw-Hill, 2003Drury, C, Management and Cost Accounting, Thomson, 2000Horngren, CT, Foster, G and Datar, S, Cost Accounting: A Managerial Emphasis, Prentice Hall, 2003Blocher, EJ, Chen, KH and Lin, TW, Cost Management. A Strategic Emphasis, Prentice Hall, 2002Johnson, HT and Kaplan, RS, Relevance Lost. The Rise and Fall of Management Accounting, HBS Press, 1987Drury, C, Management Accounting for Business Decisions, Thomson, 1997Kaplan, RS and Atkinson, AA, Advanced Management Accounting, Prentice Hall, 1998Ezzamel, M and Hart, H, Advanced Management Accounting: An Organisational Emphasis, Cassell, 1987Burch, JG, Cost and Management Accounting: A Modern Approach, West, 1994Hirsch, ML, Advanced Management Accounting, Thomson, 2000Relevant journal articles
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