n fo f o rm r m a t o n o r m a n ag a g em em e n t
P llaa n n n g , c o n o l a n d d e c s io i o n m a k in in g
D a t a i s t h ~ 1 fa mat~rfial to data Pfoc~lssin!J. 1 ( ] ' , b ' m a N o n is d a a th t h 'a'a t h 'a'a s b ~ :e: e l Pfoc~lss:ed in s u c h m a k : e it :e m e n o rrmm a t o n he e 'S ' S n i n g fu f u l,l , t r s Us~( U a m g :e i n / o r m a t i o n used m a n a g e m e n t ,t U n a n o rrgg sn s n isi s a# a# o n S o m : e ( '/'/ ,u ,u a l j~ j~ e l o l g o o d
i riri '. fo fo r m a titi o n
a s o J !o !o w s .
F in in a n c a l a n d m a n a g e m e n t a c c o u n t n g [I [I
CiarUy Compie:feness
[I [I
Time~ness Manag eab
v o lu lu m e
IFii~anciiaJlam]
~ fo f o rm rm a t ~ o T l
m O S t I m lkl k e ,
n g l o b j;j ; e ct c t iiii w s
ellectii
8IPPlro;priia;te
M a na na ge ge m n t ev wi hi
ls
m a n ,a , a ,g , g :e : e m a 3 !~ !~ ttaa c cm cm m t i n g
mse s h a r e h o l l d e f
E s t :a : a lb lb l i s h
st1ralteglies
o r p l 8 J l n i r lglg , oo o o n t o l o r d e c s i o n m a ~ in in g
M a x i m i s e p ro ro m s
P l l e l i l'l' lnln i l l 1 l g i i n l 1 0 l v e s
........
be use
vallue
III
S € ! C 0 6 titi S
system
M a x i m i isis e , r ev ev e f
m a ,n , n ag a g em e m 8 f~ f~ t
ccmrol n ibib rm rm a , o ~
n c r e l 8 i S € l market s h a r e
d e o n tald Ma o rg rg an an is is a on De oce b e tw tw e e n a ltlt er er n at at iv iv e s
.n € 's's : a b m s lhl h € d o rg rg a n i s a o n
s lhlh o u l
e po po r n g s pe d
h av e a , h i 8 1 produces
format
r € , g u l lala r i ni E e N a l lsls . III
on
ec t ~ h e p e , o lnln m a lnln c e of s y s t e m whitih m e a s u l m s en c o rrrr ec s u lb l b o :r: r d i n a ltl t e t o e n s u r e m ' g a J n i s a J ltlt i: on o n 's' s o b i lele c t i vvee s f p l a J n s lbeiin'g
B fe f e c v e o cm c m t m l is m o t p ra r a c [~ [~ c a w i h o u t p l a ~ n ~ n g . P l a n n i n g w i h o u t c cm cm i o l ~ s p o n t € 6 5
III
P~,am~ im
III
Gompa.r~ng
III
R.ecording
III
Evallua,tiing
III
G o n ec t v e
III
ny
OQJt
pll,81!1i
ac on
F in in an an c a l a n managEll119ntaccounting
IPII8J~lning,co:nl~Jroll [ 'm 'm O l d ~ c i \ s i i( ) : n l m a ' llll k iiii n g
Th
da ed e pa pa r ~ an an c a l c o n t a m m aJ aJ l g em em e a c u n h e s am am e accounts is dii1ff dii1ffl€l l€lrenc rences esbetwee~ betwee~ thiese thiese an se b e u s h e d a a . a~.allysed a~.allysed d~ff €re~tlly. €re~tlly.
fo e:dernl e:dernlall all iindv~du n dv~du ai D e t ai ai l p e l~ l~ , r ma ma n c
( IfIf f a c ie ie ffff ni e
L eg eg a qu em nt prepare F o rm rm a t o f p u b( b( lili is is ~e ~e d
P re re pa pa J pe od
mi ed mp determii~ed
wh
i in in f or or ma ma titi io io ~ m o n et et aJ aJ Y ( m oi oi S tltl lyly )
Hstoric p ~c ~c [m [m e o f p as as t o pe pe re re f o n Pag
fan
g an an i a t
A ~ d m a~ a~ a, a, ge ge me me ~ i n r eo eo or or d n g , p (l(l a. a. n~ n~ i n g an controlilling rga~ iisa.t~o~'s .adlv~tles es Heilip dedsiiol1-makii
Ig process
N o l isis ig ig a llll r eq eq u i rements to
repare
a. disc retion
Fo
lASs IFRSs cover busi~€!SS
o r n t m a m a a !g !g e
management
focu is orga iisati iisatiion's ion's actirv~t~es actirv~t~es MA
H s to to r
nc pm a.
eco
w n -m -m o e t8 t8 i
me ur
future p~armiirllgtool
C o s t c la la s s i c a t o n
e'ssentiai manage'ment T h ' e d a s s i c a o { o t c o e s is a c c o $ J n h : n g t e c h ' n i q , u e .its m a i n , u s e ' s as ol ows. Di ec cos
and ndi ec cos
F ix ix e
an
cos
var abl cos
III
D e e rm rm io io o# o# o o f h e c os os t o f ,oos:t o o n a v i o , u r
III
A bs bs o p : o n a n
III
III
O t h e r c o s t c la l a s s ifif ic ic a t io io n s R e s p o n s ib ib i
cen es and cos uni
u n i o f p ro ro du du c
m a g in in a c os o s #n #n g , o o s : t ~ v o i u m e ~ p r o nI(t t i P ) ' a n a l y s i s
service
full pr du
e rv rv ic ic e
d ep ep a m en en t
ha
he be ng
nc wh he
costed
wh nn be vi
department.
I n d irir e c m a [ e, e, riri ia ia i
III
D i r ec ec t m s .t.t e riri ia ia llll s
III
III
D i re re c ~ ab ab o u
III
III
Direct ezpensea
III
I n di di re re c t e x pe pe n se se s
III
A d m ~n ~n i s t ra ra H o n o v e r h ea ea d
III
o ts ts l d irir ec ec t
III
Selll~nlg Selll~nlg.and .and dstr~bu[~o~ dstr~bu[~o~ over~e.a
C O !8 !8 t
prime
CO!8t
iotall p ro ro d uc u c t c os os t
n d irir e
a b cu cu r
co
whi
un
c te te d
h an an g
wh
eve of act vi y.
III
Be
III
B I L l s ! ness r a t e s
III
8 8 1 i ry
P ag e
,8
buiiI~d
wi
o f a c t iv iv i ty ty .
Il
irec~of
Co m8 se i i -f f iiii x e d o r semi\I'.8Iriiai:Jlle 1xed costs. eX8Implle € l l i e c t r i i c i t b i i l ilil l~ a 8. f fifi iX iX € l dsds t a n d i i n l g c h a r g e and v8l ~abl cost p e u n t o f 11ectwiiciity used.
III
D i rl e
III
D i lrlr e
III
ma.Ee~a~s abou
S a l e s o o m m i isis s i o n ( \ a r~ r~ € s w i t hme fsa s)
a r c la la ss ss i e d a s production or m a u fa fa c l n g c os o s ts ts ; a d m in in i st st ra ra titi o c o st st s marketing or selling an d is is t b u t o n c os o s ts ts .
nt
wi
nt
he ns
wh go
he be ld
ns
ng
wi s t c k v al al u e
vi
ns h e b u g e n g p ro ro c s s
wh m an an ag ag em em en en t
ha lu
whic d u rir i n
ni he
e c s io io n
wh he
an
cton
vi
wo bus ne
id no
n ag ag e
xi
nt wi hi
n cu cu rrrr e w h e h e a c v i o r b u s in in es e s s e x s te te d
gi
n.
r es es pa pa n s b i i ~ c en en trtr e ~ s 8 . d e pa pa rtrt me me n t
o r o rg rg a n ~s ~s a[ a[ ~o ~o n a [ !L !L II~~ ct ct i o n w h o s
p e i l,l, or or m. m. aa aa 1 c
~he diirect diirect respansi respansibmli bmliitit
. a s p ed ed ffff iiii c m a n ag ag e r
is
c o e c n g p la la c
re a n a y s e d COSI
o r c os os t
be or
III
olec
her C E IN IN l R I
they
S i i i~ i~ .a .a r 8 . co c o s c en en t H es es po po n b i o r c o
re a n a lyly s e
I R .E .E S I P O I~ I~ S I I1I1 8 L I
O N IL IL Y
III
revenues
p la la c
o r e v n ue s b e o r ur her
I R .E .E V I E r N J U E C I E rN rN J T R I E M A I ~ A .G .G , IE IE I R . A I R .
M iA i A rN r N lA l A GGEE R S A R E
R IE I E S fO fO r N S l B IILL E F O R C O S T S
III
he
III III
prom centr
FOIR. RIEVEI~ UIES OrNJlLY
wiit addi[i addi[i(l(l~.a ~.allll respoTli respoTlisbll sblliiiititiies ies R . es es po po n s b l f o o as as i rehlenue's R.esponsibll R.esponsiblle. e. for c8Ipiit c8Ipiit8.11 8.11n ve ve s m en en t 8 .n .n d [~n8ndng
Gas!~niit: os
ni an be el
wh d.
P a t e n e p s od od e ( i Ba Ro
an ac vi o r w h ic ic h separate m ea ea su su r m en en t o f o s de ed
h os os p a l
product
h e b r w i n g n du du s y ) hotel)
service Th
os
pe
ng
d ep ep a m en en t
C o s b e h a v io io u r
Level of act vi C o s b e h a v o u r patterns H ig h - o w m e t h o d
iJ w h ' icic h ' c o s t s a r e a fff f e c .t.t e lclc t b y C o s t b e W a v ioio ,u , u fisrhe c h ' s n g e ' s in volume O$.Jtput JW ansgeme~ t] decisions wh' e] 'cost beW ave~ o / f e l t ] ' b a s e d 00' h e w a K n o w e d g e o f o s b e W l V i O , U f is e l s s e ~ ' t i a I fO III
BlJdge:fing·
III
D e c s io io n m a k n g ·
III
C o n t o l a c co co u n : n g ·
l~iigl~·!I(jw
as As III
Vallue
ff
ems sol
g en e a .
of ou pu ff o u t p u t
e m s s o~ o~ d
III
L im i m b e r o f r lrlr V O i ici c e s s e u e d
III
L im im b e
dl
g e n e ra ra . c on su m e d
ICOS!:
e v e l o f a c t~ t~ v ~ l y r isis e s
un
L im im b e o f
of elec
he
riise,.It
III
of ur
pri nc p~ e:s, ha
c os t m o r
be,haviiour cos
w i l III I u s t a l
prod l i c e ,
ro d u c w ~ 1 1 1 p ro
e v e o fff f a d i v i
·100 uniits
o l u m e o f o u tp tp u t
Cost
is
c os os t w h ic ic h e n d be una ec ed by increases decreases in th level level of activi activity ty
R en en t s in in g l f ac ac to to r b u ilil di di n g S t ra ra . g h t I i n e d e pr pr ec ec ia ia titi o o f machine V o u m e o f o l J t n J ! { le le v e o ~
Grap.h of sti~peo sti~peosr sr
is os whi xe n a tu tu r b u t o n l w i th th i c e a i levels levels of activi activity ty
Pa
Supervi r s s al al ar ar y c os os t Hoyalties
l~iigl~·!I(jw
Cost
whi v a riri e d irir ec ec tltl y w i t he eve of ac vi y.
C o s o f a w m a te te r a l D i re re e t l ab ab o u r c o st st s Sales commissi commission on
x e d l ,c, c o s t OO$!
a ls ls o k n o w n a s s e mi mi -v -v a riri ab ab l e/ e/ se se m i xe o s w h i c on on ta ta in in s b o xe an v a r a b l e le le m en en t a n d p a af ec ed b y c ha h a ng ng e h e e ve ve l o f a c v i
T e le le p h o n e b i llll s Salesman's Salesman's salary salary
is c o s t w h icic h v a e s d~spropor.fionaiel d~spropor.fionaielyyw i t h
Cos.t
n c re r e a s i n g o u tp tp u t
GO$t
Pa
"8i
~ab le
Fb:ed S€lmii.;var~ablle
T h e b re r e d a n d v a 1 ia i a b l S er le l e m e n t s o f s € l - v aJ aJ i a b l c os t c a b e d e € l m i ~ e h e ~ i g lh l h - I o w ' e th th o d .
Step
R e v i e w P 8 iS i S [ re r e c o rd r d s o fff f c o s t
Step .2
A d ju j u s t o r ~ f a t~ t ~ o n b e fo fo r
co
r -
&l ec p a rir i ~ g c o s Tbtal
Step ;9'.
DeteW
& 1 1 e c p s r ioio d w i i
g lh lh e s t a c t v i
evel
I
r - T b t a llll O ~e Tbtal
psrod wi
~ [ n ee d ed )
S [a [a t ~ i i
a c t ~ v ~ t yIy I eI v e rIrI I
S [a [ a t I lolo lw l w a c ivi v i at
evel
~ g ~ a c ~ i v i 1 t Iyl e v e l l T U H )
T b t a l t m i itit s a t I lolo w a c t i v i t y I lele v e r i T U L )
~west act vi yIeve
C a c ~ a [ v a . riri iaia b l isis l C O E i t
Step
~n
TCH-Tel TUH-TUl
H ig ig h
vi
ve
L ow ow e
vi
ve
bl
Fi
Pa
ni
10
ni
c os os t o f $ 4 0 0
ni $ (4 ( 4 ,0 ,0 0
60 - 1, 1 , 60 60 0
$2,400
$1,000
$0.30
C o r e la la t o n a n
e g e ss s s io io n ;
e xp x p ec e c te te d v a u e
C o r r a t io io n Coe
c ie ie n o f d e t
Es matng he E x p e c e d v a lu lu e
m i n a t io io n
n e o f b es t
C a r e ~ a t o n s n :c : c i re r e 'g' g J e 's' s s ioi o n very por. an. opi wh ms o f h e c o s b e h 'a'a v o u r s e c o n ' o f th s y ! J a b , u s , U. a k e s $ .J . J r e l h ' ~yt o u c a e p o o iuiu c $ 1 th'e o r m u / a e required fO n 'e' e a r e g r e 's' s s ioi o n a n a lyly s i s ini n c e t h e y re n o . t p ro ro v d e y ou r e : a m ami} v i a l h 'a' a t y o , a r bJ e S . f a b J i s h ' n e s r e l C l u a t o n s u s i n :g : g t h ' m9 t h o o J .
Es1 iima~iingI11h ,E1Ili ,E1Ilii~~ i~~
,oj'ibes1m
wh lu nd nt va bl he v a u e o f h e n de de pe pe nd nd en en t v a a b e .
III III III
Periectlly Periectlly corn-ella corn-ellated ted Partlly Partlly cou€l~a[e cou€l~a[e ~oorrell, ~oorrell,ated ated
E XA M F OR M Correia on oe en III III
MU
WI
pSlrilect pSlrilect po!S~tiivel po!S~tiivel p e rfrf ec ec t ~ e g 8 i,i, titi iviv e u~oorre~8i,ted
Com~ila~iion
t a l v a J ia ia t o n r2 m e a s u e s h e p r o p o r o n o f h e o ta ca
b e e x p la l a in in e
va at ons
h e v a u e o f o n e v a a b l tha.t h e v a u e o f h e o th t h e r v a a b le le .
t h e c o r re r e la l a t o n c o e fff f ic ic ie i e n t o f w o v a r iaia b le l e s 0.9, k n o h e v a r iaia b le le s a r p o s i v e l c o rr r r e a te t e d . T h e c o e f c ie i e n t o f d e te t e rr r r n in in a . o n , 0 .8 .8 1 a n h i g iv iv e m o r m e a n n g u l a n a ly ly s s . W k n o w h a 8 1 o f h e v a a t o n he va ue of e x p la l a in in e d b y v a a t o n s he va ue of
conclude t n . a . t
Note: ii
ca
b e e X p ' a ~n ~ n e b~ v .a .a n a t o n
o f v an a n ia ia . o ~ s x,
nl ar
ca Use
var at onl
x,
sa t i h a . t
o f f v a r i i a tit i ioio n s
Com~ila~iion
n ea ea r g r at em ti
an ys a l c u a t i on on )
III
nEX
&~"~:rg~pl'i $\hOwill!9' rin~ fJ/ o~st lit III
III
III
U s e u dg e m e n d ra ra , n e o f b e s
Oos1
it
Fi xed cos i ni i e r s e c f ioi o n o f f I Ii inin e , o n ax~s(,a) a n iai a ,b ,b l c o s p e r u n i ;;;;gradiient ne (b)
(EX)2
\"I1;'l.a
I~:£'I
-b
n um b e
III
III
X;
a ve v e ra ra g
Y;
e ra ra g
O t p a rs o f f d a , t a , v ,a ,a l u e
v.a111l8
Com~ila~ii(ln
IExlPecled vall~,esl
ne follows:
Probabili.fy .3
0. 0.
P ag e 2 .
beng
nu
Th
b ab ab i
D e m a n d (units)
10,000 16,000
nt
ve
n d h av av e b e
E xp x p e c e d v a lu lu e
3,000 7,200
1600 11.800
demand
