APPROXIMATELY RIGHT, NOT PRECISELY WRONG: COST ACCOUNTING, PRICING,
& DECISION MAKING
By Yoram Eden and Boaz Ronen
This book presents support tools for pricing, costing and decision-making in the modern business environment. It presents innovative methodologies, such as the Theory of Constraints (TOC), the Measurement Profile and the Cost Utilization (CUT) Diagram to cope with various situations in the hyper-competitive global environment. Some of the methods and tools have been developed by the authors and implemented in dozens of organizations worldwide. Among these tools is the Global Decision Making (GDM), that helps managers in all types of organizations to cope with problems for which the methodologies of traditional cost accounting or the Activity Based Costing (ABC) approach have no suitable answer. The book deals with the changes in the competitive business environment and the loss of relevance of traditional cost accounting and present well established tools that increase the value of any copmany. The book presents target costing as a pricing mechanism and warns managers from the "hourly rate" measure that looks simple but may be misleading. One chapter is devoted to decision making in a resource-constrained environment, and another one cops with the excess-capacity environment.
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