ACC 406 Chapter 13: Chapter 13 - Short Run Decision Making Relevant Costing
11 Apr 2012
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Short run decision making consists of choosing among alternatives with an immediate or limited end in view. Accepting a special order for less than the normal selling to utilize idle capacity and to increase this year"s profit is an example. Some decisions tend to be short run in nature however it should be emphasized that short run decisions often have long run consequences. Short run decisions are often small scale actions that serve a larger purpose. A decision making model is specific set of procedures that produces a decision, can be used to structure that decision maker"s thinking and to organize the information to make a good decision. Following is an outline of one decision making model: recognize and define the problem. Identify alternatives as possible solutions to the problem; eliminate alternatives that clearly are not feasible. You can break the steps if you find that too be useful. Example: you can use a 3 step model:
