Cost management : strategies for business decisions

목차 (Table of Contents)

• CONTENTS
• Prologue : Modern Cost Management
• Practices = xxxvii
• Why This Approach to Cost Management? = xxxviii
• What Is New about Modern Management? = xxxviii
• Corporate Express in a Nutshell = xxxix
• Global Environment of Cost Management = xxxix
• Addressing Global Competition = xxxix
• Making Global Decisions = xl
• Choosing the Organization's Long-Term Strategy : Survival of the Fittest? = xl
• Defining the Organization's Scale and Scope of Operations = xli
• Planning and Organizing the Use of Resources into Efficient Operations = xli
• Implementing Plans and Organizational Change = xlii
• Measuring and Communicating Results = xliii
• Motivating and Evaluating Performance of Individuals and Teams = xliv
• Communicating Plans and Results to Constituents = xlv
• Evaluating Success of Decision-Making and Making Improvements = xlv
• Part One Setting the Stage : The Importance of Analyzing and Managing Costs = 1
• 1 The Role of Cost Management : Finding Opportunity and Leading Change = 2
• Cost-Management Challenges at Pursuit.Com = 4
• The Organizational Role of Cost Management = 5
• Who Are Cost Managers? = 5
• Pursuit.Com's Team Focus = 6
• Cost Management and the Cost Manager = 8
• Choosing a Long-Term Strategy at Pursuit.Com = 9
• Benchmarking ; A Cost-Management Technique for Strategic Choice and Improvement = 10
• Choosing Pursuit.Com's Scale and Scope of Operations = 12
• Configuring Pursuit.Com's Value Chain = 14
• Analyzing Alternative Value-Chain Configurations = 14
• Planning and Organizing the Efficient Use of Resources at Pursuit.Com = 16
• Forming a Cost-Management Team = 17
• Analysis of Pursuit.Com's Accounts Receivable Process = 17
• Employees Who Do the Work Often Know Best = 21
• The Team's Recommendation = 21
• Implementing Plans and Organizational Change at Pursuit.Com = 22
• Chapter Summary = 23
• Key Terms = 23
• Meeting the Cost Management Challenge = 23
• Solutions to You're the Decision Maker = 24
• Appendix to Chapter 1 : Institute of Management Accountants : Standards of Ethical Conduct for Management Accountants = 27
• Review Questions = 28
• Critical Analysis = 28
• Exercises = 29
• Problems = 31
• Cases = 34
• 2 Using Lead and Lag Measures to Communicate, Motivate, and Evaluate = 38
• MST : Ahead of the Competition = 40
• Lead and Lag Indicators : Signals of Performance = 40
• Measures of Organizational Learning and Growth = 42
• Employee Education and Training = 43
• Innovativeness = 43
• Opportunities for Improvement = 43
• New Product Development Time = 43
• Measuring Results : Process Efficiency = 44
• Measuring Quality = 45
• Measuring Productivity = 46
• Measuring Cycle Time = 47
• Measuring Throughput Efficiency = 48
• Preventing Process Mistakes = 49
• Measuring Customer Satisfaction and Loyalty = 50
• Measuring Customer Satisfaction = 50
• Measuring Customer Loyalty = 51
• Social and Cultural Differences as Factors in Customer Satisfaction = 51
• Using Lead Indicators for Product and Service Design = 52
• Target Costing for Product Design = 52
• Communicating Results to Employees = 54
• The Balanced Scorecard = 55
• Quantifying the Causal Relationships = 57
• Chapter Summary = 60
• Key Terms = 61
• Meeting the Cost Management Challenge = 61
• Solutions to You're the Decision Maker = 61
• Appendix to Chapter 2 : Setting up Computer Spreadsheets = 65
• Review Questions = 66
• Critical Analysis = 67
• Exercises = 67
• Problems = 69
• Cases = 73
• 3 Managing Costs of Constrained Resources = 76
• Introduction = 78
• Goals and Limits of Productive Processes = 79
• The Aerial View／Overview of the Problem = 79
• Process Capacity = 80
• The Theory of Constraints : The Basics = 81
• What Is a Bottleneck? = 81
• Measures of Capacity = 82
• Managing Constraints = 87
• Tackling the Bottlenecks at CMD = 92
• Chapter Summary = 93
• Key Terms = 93
• Meeting the Cost Management Challenges = 93
• Solutions to You're the Decision Maker = 94
• Review Questions = 95
• Critical Analysis = 95
• Exercises = 96
• Problems = 98
• Cases = 101
• Part Two Cost Measurement Systems = 105
• 4 Measuring Costs of Operations = 106
• Introduction = 108
• What Are the Resources of an Organization? = 108
• Types of Resources = 108
• How Resources Are Used = 109
• Traceability of Resources = 110
• Three Dimensions of Resources = 111
• How Do Organizations Measure Costs of Resources? = 112
• Design Issues = 113
• What Do We Really Mean by "Cost?" = 114
• Total Cost = 115
• Average Cost = 116
• Tracing versus Allocating Costs = 117
• Unit-Level Costs and Variable Costs = 118
• Fixed Costs, Committed Costs, and Sunk Costs = 110
• Alternative Costing Methods = 121
• Throughput Costing = 121
• Variable Costing = 123
• Absorption Costing = 123
• Financial Management of Processes = 125
• Throughput Costing = 126
• Variable Costing = 128
• Absorption Costing = 130
• Comparing Operating Incomes = 130
• Chapter Summary = 133
• Key Terms = 134
• Meeting the Cost Management Challenges = 134
• Solutions to You're the Decision Maker = 135
• Review Questions = 136
• Critical Analysis = 137
• Exercises = 137
• Problems = 138
• Cases = 144
• 5 The Design and Use of Activity-Based Costing Systems = 146
• PMI's Decision-Making and Cost-System Design = 148
• PMI's Competitive Situation = 148
• Cost-System Design = 148
• PMI's Resources and Activities = 149
• ABC : Application to Service and Manufacturing = 150
• Processes at PMI = 150
• Describing the Hierarchy of Resources = 152
• Activities : Their Impacts on Resource Use = 153
• Stage 1 : Measuring the Costs of Activities = 155
• Approaches to Identification and Classification of Activities = 155
• PMI's Activity List = 157
• Selecting Cost-Driver Bases = 160
• Measuring Resource Costs of Activities = 163
• Tracing Resource Costs to Activities = 163
• Is Something Wrong with This Picture? = 168
• Measuring Stage 2 Cost-Driver Rates = 173
• Condensing the Activity List = 173
• Tracing Costs of Activities to Products and Services = 176
• Unit-Level ABC Costs = 177
• Full-ABC Costs = 177
• Per-Unit Cost Difference = 180
• Product and Customer Profitability = 181
• Product Profitability = 181
• Customer Profitability = 182
• Estimating the Costs of New Products Using ABC = 184
• A Simple Case : Different Materials Only = 184
• A More Complex Case : The Novelty Toy Decision = 184
• Chapter Summary = 187
• Key Terms = 188
• Meeting the Cost Management Challenges = 188
• Solutions to You're the Decision Maker = 188
• Appendix to Chapter 5 : Additional Activity Data = 190
• Review Questions = 194
• Critical Analysis = 194
• Exercises = 195
• Problems = 198
• Cases = 201
• 6 Cost Flows and Job Costing = 206
• How Do Organizations Choose among Costing Systems? = 208
• Evaluating Major Types of Costing Systems = 209
• The Basic Cost Flow Model = 210
• Cost Flows and Jobs = 211
• Managing and Using Cost Flow Information = 212
• Tracing and Assigning Costs to Jobs = 213
• Setting Predetermined Cost-Driver Rates = 214
• Using Predetermined Cost-Driver Rates = 216
• Job-Cost Accounting Systems = 222
• Basic Job-Cost Flows = 222
• Larsen Construction Job-Cost Accounts = 223
• Job-Cost Summary = 225
• Completion of Jobs = 226
• Sale of Completed Jobs : Finished Goods to Cost of Goods Sold = 226
• Overhead Adjustments = 226
• Managing Jobs and Projects = 231
• Project Management = 231
• Job Cost and Project Improprieties = 233
• Using Job Costs for Planning and Decision-Making = 235
• Chapter Summary = 236
• Key Terms = 236
• Meeting the Cost Management Challenges = 236
• Solutions to You're the Decision Maker = 237
• Appendix A : Job-Cost Journal Entries = 239
• Appendix B : Activity Costing for Job RR6 = 241
• Review Questions = 244
• Critical Analysis = 244
• Exercises = 245
• Problems = 249
• Cases = 257
• 7 Process Costing = 260
• Monterey Bay Abalone's Profitability and Outlook = 262
• Process Costing System Design = 262
• Monterey Bay Abalone = 265
• Monterey Bay Abalone's Aquaculture Processes = 265
• Why It's Important to Have Reliable Process Cost Information = 267
• Process Costing : The Basics = 268
• Preview of the Examples = 268
• Example 1 : All Units Fully Completed(No Beginning or Ending WIP Inventory) = 268
• Basic Calculations = 269
• Decision-Making Implications = 269
• Example 2 : Some Units Not Fully Completed(Ending WIP Inventory) = 270
• Process-Costing Steps = 270
• Step 1 : Compute the Flow of Physical Units = 270
• Step 2 : Compute Equivalent Units = 271
• Step 3 : Summarize Costs to Account for = 272
• Step 4 : Compute Cost per Equivalent Unit = 272
• Step 5 : Assign Costs to Units Completed and in Process = 273
• Accounting Entries = 274
• Example 3 : Recognizing Costs of Spoilage(Mortality) = 274
• Computing Spoilage Costs = 275
• Reporting Spoilage Costs = 278
• Example 4 : Beginning and Ending WIP Plus Spoilage(Mortality) = 278
• Weighted-Average Costing versus FIFO = 279
• Using Weighted-Average Costing = 279
• Using FIFO Costing = 282
• Choosing between Weighted-Average and FIFO Process Costing : Comparing Costs and Benefits = 286
• Stop and Review : Comparison of Process Costing Steps for the Two Methods = 287
• Example 5 : Accounting for Costs Transferred to Another Process = 288
• Chapter Summary = 291
• Key Terms = 291
• Meeting the Cost Management Challenges = 291
• Solutions to You're the Decision Maker = 292
• Appendix A : Process-Costing Journal Entries = 294
• Appendix B : Operation Costing = 295
• Review Questions = 297
• Critical Analysis = 297
• Exercises = 298
• Problems = 302
• Cases = 306
• 8 Joint Process Costing = 310
• Joint Product Processes = 312
• The Importance of Split-Off = 312
• One Input - More than One Input = 313
• The Decision Challenge : Which Joint Products to Produce? = 313
• Estimating Profit from Joint Products = 314
• Sell Intermediate Products or Process Them Further? = 315
• Maximizing the Profit of Joint Product Processes = 317
• Profit Analysis of Option 1 - Specialty and Standard Lumber Plus Wood Chips or Wood Pulp = 317
• Profit Analysis of Option 2 - Standard Lumber Plus Wood Chips or Wood Pulp = 319
• Most Profitable Products = 319
• Why Allocate Joint Costs? = 320
• How Joint Costs Can Be Good Business for Lawyers = 322
• Joint Allocation Methods = 323
• Distinguishing between Main and By-Products = 323
• Using the Net Realizable Value(NRV) Method = 324
• Using the Physical-Measures Method = 325
• Choosing among Joint-Cost Allocation Methods = 329
• By-Product Accounting : The Basics = 329
• What to Do with Scrap and Waste = 331
• Chapter Summary = 332
• Key Terms = 332
• Meeting the Cost Management Challenges = 332
• Solutions to You're the Decision Maker = 333
• Review Questions = 334
• Critical Analysis = 334
• Exercises = 335
• Problems = 338
• Cases = 342
• 9 Managing and Allocating Support-Service Costs = 346
• The Service-Cost Challenge = 348
• Internal or Outsourced Support Services? = 348
• Managing Internal Support-Service Costs = 349
• Distinguishing between Direct and Support Services = 350
• Who Pays for Internal Support-Service Costs? = 351
• Support-Service Spending and Use = 352
• Why Allocate Service Costs? = 353
• Decision-Making and Cost Allocations = 354
• Other Uses of Cost Allocations = 354
• Cost-Management Implications for Internal Support Services = 355
• Cost Allocation from Support-Service Departments to Internal Customers = 356
• Step 1 : Identify the Costs to Be Allocated to Internal Customers - Single or Multiple Cost Pools? = 356
• Support-Service Spending = 356
• Support-Service Use = 357
• Measuring the Costs to Be Allocated = 358
• Step 2 : Choose the Appropriate Cost-Allocation Base(s) and Rate(s) - ABC or Traditional? = 358
• Activity-Based Costing Approach = 358
• Traditional Approach = 359
• Step 3 : Select and Use a Cost Allocation Method = 361
• Direct Method = 361
• Step Method = 365
• Ms. Fukami's Accurate but Politically Incorrect ABC Approach = 371
• Step 4 : Determine if the Cost Allocations Achieve the Desired Results = 373
• Cost Allocation Accuracy = 373
• Cost Allocation Effects = 373
• Cost Allocation Costs and Benefits = 375
• Chapter Summary = 377
• Key Terms = 377
• Meeting the Cost Management Challenge = 377
• Solutions to You're the Decision Maker = 378
• Appendix to Chapter 9 : The Reciprocal Method = 380
• Review Questions = 387
• Critical Analysis = 387
• Exercises = 388
• Problems = 392
• Cases = 398
• Part Three Process Management and Decision Making : Identifying Opportunities for Improvement = 403
• 10 Methods and Implementation of Activity-Based Management = 404
• The Importance of Activity-Based Information to Precision Molding, Inc.'s Success = 406
• Activity-Based Costing : The Foundation of Process Improvement = 407
• Combining ABC and Target Costing as a Next Step of Analysis = 407
• The Importance of Customer Value = 410
• Eliminating Non-Value-Added Activities Is a Competitive Necessity = 410
• Identifying Value-Added Activities = 412
• PMI's Value-Added Analysis = 413
• What Tasks Does Activity-Based Management Require? = 414
• Detailed Activity Analysis = 415
• Identifying Opportunities for Process Improvement = 416
• Asking the Question "Why?" = 417
• Cost of Saved Resources = 418
• Implementation of Activity-Based Costing and Management = 418
• Should All Organizations Adopt ABC and ABM? = 419
• Can You Be Sure that ABC and ABM Will Be Successful? = 419
• Chapter Summary = 422
• Key Terms = 422
• Meeting the Cost Management Challenges = 423
• Solutions to You're the Decision Maker = 423
• Appendix to Chapter 10 : Activity Costs and Customer Values = 424
• Review Questions = 426
• Critical Analysis = 426
• Exercises = 427
• Problems = 429
• Cases = 432
• 11 Managing Quality and Time to Create Value = 436
• Why Is Quality Important? = 438
• Quality at Any Cost? = 438
• Total Quality Management(TOM) = 439
• Return on Quality(ROQ) = 439
• Comparing the Views of Quality = 440
• Do TQM and ROQ Really Conflict? = 440
• Dimensions of Quality = 441
• Product and Service Attributes = 441
• Customer Service before and after the Sale = 442
• How Do Organizations Measure Quality? = 442
• Lead Indicators of Quality = 442
• Diagnostic Information = 446
• Customer Satisfaction = 449
• Trade-offs between Quality and Price = 451
• Costs of Quality = 451
• Controlling Quality = 451
• Failing to Control Quality = 452
• Measuring Costs of Quality = 453
• Reporting Costs of Quality = 453
• Quality Awards and Certificates = 454
• The Importance of Managing Time in a Competitive Environment = 456
• New Product and Service Development Time = 456
• Customer-Response Time and Cycle Time = 456
• Costs of Time = 457
• Managing Quality + Time ＝ JIT = 458
• JIT Manufacturing = 458
• JIT Success Factors = 462
• Chapter Summary = 464
• Key Terms = 464
• Meeting the Cost Management Challenges = 465
• Solutions to You're the Decision Maker = 465
• Appendix to Chapter 11 : Construction and Use of Control Charts = 468
• Review Questions = 471
• Critical Analysis = 471
• Exercises = 472
• Problems = 477
• Cases = 480
• 12 Cost Estimation = 484
• What Is Cost Estimation? = 486
• Cost versus Expenditures = 486
• Costs Do Not Just Happen = 487
• Why Estimate Costs? = 487
• Cost Management = 488
• Decision Making = 488
• Planning and Standard Setting = 488
• A Simple World : One Cost Driver and Fixed／Variable Cost Behavior = 489
• A More Complex World : Multiple Cost Drivers and Complex Cost Behavior = 490
• Cost-Benefit Test = 490
• Step Costs = 490
• Semivariable Costs = 491
• Learning Curve = 492
• Cost Estimation Methods = 496
• Statistical Cost Estimation Using Regression Analysis = 497
• Is There a Logical Relationship between Costs and Their Drivers? = 497
• A Simple Model for Regression Analysis = 498
• Application to CC Catering = 499
• Using the Results = 501
• Using Multiple Regression Analysis to Estimate Cost Drivers for Activity-Based Management and Decision-Making = 502
• Application to CC Catering = 504
• A Cautionary Note about Using Regression = 506
• Account Analysis Method = 506
• How Do You Choose between Regression and Account Analysis? = 508
• Data Problems = 508
• Engineering Method = 509
• Unit Costs = 509
• Job Costs = 510
• New Product Costs = 510
• New Customer Costs = 510
• Facility Costs = 510
• Comparing the Estimates = 510
• Using the Results = 511
• Meals Sold = 511
• Jobs = 512
• New Products = 512
• New Customers = 512
• Facilities = 512
• The Outsourcing Decision = 513
• Costs and Benefits of Product Variety = 513
• Ethical Issues = 514
• Choosing an Estimation Method = 515
• Relevance of Data Inputs = 515
• Costs and Benefits of More Sophisticated and Detailed Methods = 515
• Choosing a Cost Equation = 515
• Chapter Summary = 516
• Key Terms = 517
• Meeting the Cost Management Challenge = 517
• Solutions to You're the Decision Maker = 517
• Appendix to Chapter 12 : Technical Notes on Regression = 518
• Review Questions = 520
• Critical Analysis = 521
• Exercises = 522
• Problems = 529
• Cases = 536
• 13 Financial Modeling and Decision Making = 538
• What Is Financial Modeling? = 540
• The Cost-Volume-Profit Model = 541
• The Break-Even Point = 541
• Target Income = 543
• The CVP Model and Income Taxes = 544
• Manipulation and Analysis of Variables = 545
• Multiple Products and the Sales Mix = 545
• Limitations of the Basic CVP Model = 548
• CVP and ABC's Multiple Cost Drivers = 548
• Using ABC in Financial Modeling = 549
• The CVP Model and Short-Term Decision-Making = 551
• Characteristics of Information Used in Decision-Making = 551
• Relevant Information : An Expanded View = 552
• Make or Buy = 555
• Outsourcing at Galaxy Productions = 555
• How Outsourcing Can Eliminate Non-Value-Added Activities = 556
• The Concept of Opportunity Cost = 558
• Nonfinancial Considerations of Closure Decisions = 559
• The Optimal Use of Scarce Resources = 559
• Multiple Scarce Resources = 560
• Pricing Decisions = 561
• Influences on Prices = 561
• Short-Run versus Long-Run Pricing Decisions = 562
• Pricing of Special Orders = 563
• More on Cost-Based Pricing = 564
• Target Costing = 565
• Life-Cycle Costs : The Impact on Prices = 567
• Pricing Practices and the Law = 567
• Chapter Summary = 568
• Key Terms = 568
• Meeting the Cost Management Challenges = 568
• Solutions to You're the Decision Maker = 569
• Appendix to Chapter 13 : Linear Programming = 569
• Review Questions = 573
• Critical Analysis = 574
• Exercises = 574
• Problems = 580
• Cases = 587
• 14 Making Long-Term Capital Investment Decisions = 590
• Strategic Issues = 592
• Identifying Good Investments = 593
• Replacements and Minor Improvements = 593
• Expansion = 594
• Strategic Moves = 594
• Due Diligence Investigations = 595
• Financial Analysis of Alternatives = 597
• Financial Records = 597
• Interviews with Operating and Marketing Personnel = 597
• Industry Data and Competitor Analysis = 598
• Nonfinancial Analysis of Alternatives = 598
• Justification of Investments in High-Tech Projects = 600
• Sensitivity Analysis = 601
• The Approval Process = 602
• Biases in the Process = 602
• Project Implementation and Control = 603
• Audits = 604
• Ethical Issues = 604
• Misstating Information = 604
• Misstating Results = 605
• Investing in Unethical Projects = 605
• Capital Budgeting in Nonprofit Organizations = 605
• Chapter Summary = 606
• Key Terms = 606
• Meeting the Cost Management Challenges = 606
• Solutions to You're the Decision Maker = 607
• Appendix to Chapter 14 : Discounted Cash Flow Analysis = 607
• Review Questions = 613
• Critical Analysis = 613
• Exercises = 615
• Problems = 617
• Cases = 620
• Part Four Financial and Operational Budgeting and Performance Analysis = 621
• 15 Budgeting and Financial Planning = 622
• Strategic Panning : Achieving and Maintaining a Competitive Advantage = 624
• What Is a Strategic Long-Range Plan? = 624
• What Are the Key Purposes of Budgeting Systems? = 625
• Planning = 625
• Facilitating Communication and Coordination = 625
• Allocating Resources = 625
• Managing Financial and Operational Performance = 626
• Evaluating Performance and Providing Incentives = 626
• Organizations Use Many Types of Budgets = 626
• How the Master Budget Becomes a Planning Tool = 627
• Sales Budget : The Starting Point = 627
• Operational Budgets : Meeting the Demand for Goods and Services = 629
• Budgeted Financial Statements : Completing the Master Budget = 630
• Master Budget for Nonprofit Organizations = 630
• International Aspects of Budgeting = 630
• Illustrating the Master Budget = 631
• Sales Budget = 632
• Production Budget = 632
• Direct-Material Budget = 633
• Direct-Labor Budget = 635
• Manufacturing Overhead Budget = 635
• Selling, General, and Administrative(SG&A) Expense Budget = 637
• Cash Receipts Budget = 638
• Cash Disbursements Budget = 639
• Cash Budget : Combining Receipts and Disbursements = 640
• Budgeted Schedule of Cost of Goods Manufactured and Sold = 641
• Budgeted Income Statement = 642
• Budgeted Balance Sheet = 643
• Assumptions and Predictions Underlying the Master Budget = 645
• Financial Planning Models = 645
• Who Is Responsible for Budget Administration? = 646
• Behavioral Implications of Budgets = 646
• Budgetary Slack : Padding the Budget = 647
• Participative Budgeting = 648
• Ethical Issues in Budgeting = 648
• Zero-Base Budgeting for Discretionary Costs = 649
• Contemporary Trends in Budgeting and Financial Planning = 649
• Chapter Summary = 650
• Key Terms = 650
• Meeting the Cost Management Challenges = 651
• Solutions to You're the Decision Maker = 651
• Appendix to Chapter 15 : Inventory Management = 653
• Review Questions = 657
• Critical Analysis = 657
• Exercises = 658
• Problems = 662
• Cases = 669
• 16 Standard Costing, Variance Analysis, and Kaizen Costing = 674
• Using Standard-Costing Systems for Control = 676
• Management by Exception = 677
• Setting Standards = 677
• Perfection versus Practical Standards : A Behavioral Issue = 679
• Use of Standards by Nonmanufacturing Organizations = 680
• Costs and Benefits of Standard-Costing Systems = 681
• Cost Variance Analysis = 681
• Direct-Material Standards = 681
• Direct-Labor Standards = 682
• Standard Costs Given Actual Output = 682
• Analysis of Cost Variances = 682
• Direct-Material Variances = 683
• Direct-Labor Variances = 684
• Multiple Types of Direct Material or Direct Labor = 686
• Allowing for Defects or Spoilage = 686
• Significance of Cost Variances : When to Follow Up = 687
• Size of Variances = 687
• Recurring Variances = 688
• Trends = 688
• Controllability = 688
• Favorable Variances = 689
• Costs and Benefits of Investigation = 689
• Statistical Analysis = 689
• Behavioral Effects of Standard Costing = 690
• Controllability of Variances = 691
• Which Managers Influence Cost Variances? = 691
• Interaction among Variances = 692
• Using Standard Costs for Product Costing = 693
• Journal Entries under Standard Costing = 693
• Cost Flows under Standard Costing = 695
• How Information Technology Impacts Standard Costing = 695
• Use of Bar Codes = 696
• Computer-Aided Design = 696
• Standard Costing : Its Traditional Advantages = 696
• Changing Role of Standard-Costing Systems in Today's Manufacturing Environment = 697
• Criticisms of Standard Costing in Today's Manufacturing Environment = 697
• Adapting Standard-Costing Systems = 699
• Kaizen Costing = 700
• Chapter Summary = 701
• Key Terms = 702
• Meeting the Cost Management Challenges = 702
• Solutions to You're the Decision Maker = 703
• Appendix to Chapter 16 : Production Mix and Yield Variances = 704
• Review Questions = 708
• Critical Analysis = 708
• Exercises = 708
• Problems = 712
• Cases = 717
• 17 Flexible Budgets, Overhead Cost Management, and Activity-Based Budgeting = 720
• What Are Flexible Overhead Budgets? = 722
• Advantages of Flexible Budgets = 723
• The Activity Measure : Based on Input or Output = 724
• The Flexible Overhead Budget Illustrated = 725
• Overhead Application in a Standard-Costing System = 727
• Choice of Activity Measure = 728
• Impact of Information Technology = 729
• Overhead Cost Variances = 729
• Flexible Budget : The Basis for Overhead Cost Management = 729
• Variable Overhead Variances = 730
• Fixed Overhead Variances = 733
• What Do Four-Way, Three-Way, and Two-Way Variance Analyses Tell the Cost Manager? = 736
• Using the Overhead Cost Performance Report in Cost Management = 737
• Using Standard Costs in Product Costing = 738
• Journal Entries under Standard Costing = 739
• Disposition of Variances = 739
• Activity-Based Flexible Budget = 739
• How Does ABC Affect Performance Reporting? = 742
• Chapter Summary = 743
• Key Terms = 743
• Meeting the Cost Management Challenges = 744
• Solutions to You're the Decision Maker = 745
• Appendix A : Proration of Cost Variances = 746
• Appendix B : Standard Costing in a Just-in-Time Environment = 750
• Review Questions = 752
• Critical Analysis = 752
• Exercises = 752
• Problems = 755
• Cases = 760
• 18 Customer Profitability Analysis, Sales Performance Evaluation, and Income Reporting = 764
• Section 1 : Customer Profitability Analysis = 766
• Illustration of Customer Profitability Analysis = 767
• Product Life-Cycle Costs = 773
• Section 2 : Sales Variance Analysis = 774
• Illustration of Sales Variance Analysis = 775
• Incentive Effects of Commissions Based on Sales Revenue versus Contribution Margin = 786
• Nonfinancial Performance Measures = 786
• Meeting the Sales Budget : Possible Ethical Conflicts = 787
• How Hard Should It Be to Achieve the Budget? = 787
• Section 3 : Income Reporting Effects of Alternative Product-Costing Approaches = 788
• Product Costs = 788
• Fixed Manufacturing Overhead : The Key = 788
• Illustration of Absorption and Variable Costing = 789
• Absorption-Costing Income Statements = 790
• Variable-Costing Income Statements = 790
• Reconciling Income under Absorption and Variable Costing = 791
• Cost-Volume-Profit Analysis = 793
• Evaluation of Absorption and Variable Costing = 793
• A Note on Throughput Costing = 796
• Chapter Summary = 797
• Key Terms = 798
• Meeting the Cost Management Challenges = 798
• Solutions to You're the Decision Maker = 798
• Appendix to Chapter 18 : Effect of the Fixed-Overhead Volume Variance under Absorption and Variable Costing = 800
• Review Questions = 802
• Critical Analysis = 802
• Exercises = 803
• Problems = 807
• Cases = 813
• Part Five Evaluating and Managing Performance = 819
• 19 Organizational Design, Responsibility Accounting, and Evaluation of Divisional Performance = 820
• Decentralized Organizations and Responsibility Accounting = 822
• Centralization versus Decentralization = 822
• Benefits and Costs of a Decentralized Organization Structure = 823
• Responsibility Accounting = 824
• Cost Center = 824
• Discretionary Cost Center = 824
• Revenue Center = 825
• Profit Center = 825
• Investment Center = 825
• Illustration of Responsibility Accounting = 825
• Corporate Level = 827
• Division Level = 827
• Plant Level = 828
• Department Level = 828
• Work Center Level = 828
• Performance Reports = 828
• Budgets, Variance Analysis, and Responsibility Accounting = 830
• Activity-Based Responsibility Accounting = 831
• How Does Responsibility Accounting Affect Behavior? = 832
• Information or Blame? = 832
• Is There Really Cost or Revenue Controllability? = 832
• Motivating Desired Behavior = 832
• Measuring Performance in Investment Centers = 834
• Return on Investment as a Performance Measure = 835
• Residual Income as a Performance Measure = 837
• Economic Value Added as a Performance Measure = 840
• Measuring Income and Invested Capital = 842
• Invested Capital = 842
• Measuring Investment-Center Income = 845
• Inflation and Deflation : Current Value versus Historical-Cost Accounting = 846
• Measuring Income and Invested Capital Summary = 846
• Other Issues in Divisional Performance Evaluation = 847
• Alternatives to ROI, Residual Income, and Economic Value Added(EV$$A^?$$) = 847
• Importance of Nonfinancial Information = 848
• Measuring Performance in Nonprofit Organizations = 848
• When Does Your Organization Need New Performance Measures? = 848
• Chapter Summary = 849
• Key Terms = 850
• Meeting the Cost Management Challenges = 850
• Solutions to You're the Decision Maker = 850
• Review Questions = 851
• Critical Analysis = 852
• Exercises = 852
• Problems = 855
• Cases = 863
• 20 Transfer Pricing = 868
• The Impact of Transfer Pricing on Organizations = 870
• Goal and Behavioral Congruence = 871
• General Transfer-Pricing Rule = 871
• Transfers Based on the External Market Price = 875
• Negotiated Transfer Prices = 876
• Cost-Based Transfer Prices = 877
• Standard versus Actual Costs = 878
• Activity-Based Costing = 878
• Remedying Motivational Problems of Transfer-Pricing Policies = 879
• Undermining Divisional Autonomy = 879
• Dual Transfer Prices = 880
• Global Transfer-Pricing Practices = 881
• Multinational Transfer Pricing = 881
• Segment Reporting and Transfer Pricing = 884
• Transfer Pricing in the Service Industry = 885
• Chapter Summary = 885
• Key Terms = 885
• Meeting the Cost Management Challenges = 885
• Solutions to You're the Decision Maker = 886
• Review Questions = 886
• Critical Analysis = 887
• Exercises = 887
• Problems = 890
• Cases = 896
• 21 Incentive Systems and Performance Measurement = 960
• Fundamental Principles of Incentive Compensation Plans = 902
• Pay for Performance = 902
• The Folly of Rewarding A When You Want B = 903
• Where to Begin? = 904
• Views of Behavior = 904
• Expectancy Theory View = 904
• How Do Extrinsic and Intrinsic Rewards Affect Incentive Systems? = 905
• Agency Theory View = 906
• Using the Balanced Scorecard = 907
• Four Basic Balanced Scorecard Perspectives = 908
• The Learning and Growth Perspective = 909
• The Internal Business and Production Process Perspective = 910
• The Customer Perspective = 912
• The Financial Perspective = 914
• Implementing the Balanced Scorecard = 914
• Implementing the Balanced Scorecard at Valley Commercial Bank = 916
• Economic Value Added = 919
• Linking Economic Value Added and the Balanced Scorecard = 922
• Motivational Issues in Designing Incentive Systems for Division Managers and Their Subordinates = 922
• Current versus Future Performance = 922
• Basing Rewards on Division Performance or Companywide Performance = 923
• Using Fixed Formulas or Subjectivity in Providing Rewards = 923
• Performance Evaluation Based on Accounting Results or Stock Performance = 924
• Absolute Performance Evaluation or Relative Performance Evaluation? = 924
• Cash Awards, Stock Awards, or Prizes = 925
• Application to Nonprofit Organizations = 926
• Increasing Use of Management Methods Developed in the Private Sector = 926
• Chapter Summary = 927
• Key Terms = 927
• Meeting the Cost Management Challenges = 928
• Solutions to You're the Decision Maker = 928
• Review Questions = 929
• Critical Analysis = 930
• Exercises = 931
• Problems = 932
• Cases = 936
• Glossary = 938
• Credits = 948
• Bibliography = 949
• Index = 956