ACC2200 Study Guide - Final Guide: Sunk Costs, Management Accounting, Opportunity Cost

• School: Monash University
• Department: Business - Accounting
• Course: ACC2200
• Professor: Prabanga Thoradeniya

Document Summary

The mgt accountant provides relevant info to managers and teams who make decisions. When providing info, you must think about the type of decision the managers are going to make. Involve increases or decreases in capacity- resource commitments related resources. More difficult to reverse and their effects may extend over long time periods. Eg. how we can use the resources that we already have (can"t discontinue, just produce. Eg. adjusting the resources we already have (to build a new factory. In reality, sometimes some stages occur at the same time. Who: clarify the problem, specify the decision criterion, identify the alternative courses of action, collect info about the relevant costs & benefits, compare the costs & benefits of each alternative, select a course of action. Identify the problem and see what the potential reasons for it. Can"t improve quality while the problem? reducing costs. However, must only choose one, they can"t occur at the same time.