Essay on Cost Volume Profit Analysis and Costing for the 21st Century

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Cost Volume Profit Analysis and Costing for the 21st Century

Abstract
Cost value is the analysis of different divisions or business units of a firm on the basis of their opportunity cost and economic rent (“Cost value definition”). The objective of cost value is to determine which division or unit should be kept, expanded, sold, or shut down (“Cost value definition”). Cost analysis is an important component of all economic evaluation techniques, especially when it comes to planning and self-assessment. Cost value is the analysis of different divisions or business units of a firm on the basis of their opportunity cost and economic rent (“Cost value definition”). The objective of cost value is to determine which division or unit
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Cost analysis is an important component of all economic evaluation techniques, especially when it comes to planning and self-assessment. Cost analysis is particularly useful for the following: planning and cost projections, assessing efficiency, assessing priorities, accountability, and assessing equity. With planning and cost projections, a cost analysis can help determine the level of funding necessary to achieve a desired change. When assessing efficiency, cost analysis makes it possible to assess the efficiency of programs by comparing cost profiles from equally effective programs and identifying cost categories for further efficiency studies (“Cost analysis: introduction,”). With assessing priorities, cost analysis is helpful in that it provides information on the health resource allocation. When looking at accountability through a cost analysis, it allows one to know how the funds are spent and whether they are spent as intended (“Cost analysis: introduction,”). Finally, with assessing equity, cost analysis can help one assess how health resources are distributed among various population groups (“Cost analysis: introduction,”). I agree with the notion of value costing. By looking at value costing through a cost analysis, it benefits a copy as the cost analysis first finds, quantifies, and adds all the positive factors, then it identifies, quantifies, and subtracts all the negatives and the costs (Reh). By

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