Concept introduction:
Decision making plays an important role in the management. The decisions taken by managers are called managerial decisions. Managerial Decisions are decisions taken by managers for the operations of a firm. These decisions include setting target growth rates, hiring or firing employees, and deciding what products to sell. Manager’s decisions are taken on the basis of quantitative as well as the qualitative measures. The managerial decision includes the decisions like make or buy, accept or reject new offers, sell or further process etc. These decisions are taken on the basis of relevant costs.
Relevant costs are the costs that are relevant for any decision making. Relevant costs are helpful for take managerial decisions like make or buy, accept or reject new offers, sell or further process etc.
Two basic types of the relevant costs are as follows:
- Out-of-pocket costs
- Opportunity costs
To indicate:
Three qualitative factors to be considered for the investment decision
Want to see the full answer?
Check out a sample textbook solutionChapter 7 Solutions
Managerial Accounting - With Access
- Strategic decisions occur ______. A. frequently and involve immediate decisions B. frequently and involve long-term decisions C. infrequently and involve long-term decisions D. infrequently and involve immediate decisionsarrow_forwardPlease study and complete the following table by stating whether the characteristics of the information supporting these decision-making types: (a) are ill-defined or well-defined; (b) use internal or external information; (c) use internal or external information sources; (d) use future-oriented or historical information; (e) are frequent or infrequent; (f) use more or less accurate information. In the final column of the table, please provide one (1) example for each type of decision-making that illustrates and confirms your assessment of the information characteristics for each decision type.arrow_forward(CMA adapted) The process of creating a financial plan of the revenues and resources needed to carry out activities and meet financial goals is referred to as: Group of answer choices budgeting. benchmarking. cost - benefit analysis. value - added analysis.arrow_forward
- critically discuss and evaluate the issues in the langtry benchmark-setting decisionarrow_forwardThree phases of the management process are controlling, planning, and decision making. Match the following descriptions to the proper phase:Phase of management process DescriptionControlling a. Monitoring the operating results of implemented plans and comparing the actual results with expected results.Planning b. Inherent in planning, directing, controlling, and improving.Decision making c. Long-range courses of action.arrow_forwardAccounting policies for exploration and evaluation costs should be determined in accordance with which accounting standard? Select one: a. AASB 8 b. AASB 108. c. AASB 106. d. AASB 6arrow_forward
- Give an example of each of the following: a quantitative basis for making a decision and a qualitative basis for making a decision. Explainarrow_forward1. Explain what is meant by the term decision model. 2. Distinguish between qualitative and quantitative decision analyses. 3. Choose an organization and a particular decision situation. Then give examples, using that context, of each step in the decision-making process described in this session.arrow_forwardThere are five name stages in the Financial Service Market Study: Problem Definition,Design of Questionnaire and Pretesting, Fieldwork, …………………………... andconclusion/recommendations.a) Positioningb) Segmentationc) Fieldworkd) Data Analysisarrow_forward
- Distinguish between quantitative and qualitative factors in decision making.arrow_forwardClassify the performance measures below into the most likely balanced scorecard perspective itrelates to. Label your answers using C (customer), P (internal process), I (innovation and growth), or F(financial). Customer wait timearrow_forwardExplain what is meant by the term decision model. 2. Distinguish between qualitative and quantitative decision analyses. 3. Choose an organization and a particular decision situation. Then give examples,using that context, of each step in the decision-making process described in thissession.arrow_forward
- Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College