Concept explainers
Concept Introduction:
Decision making plays an important role in the management. The decisions taken by managers are called managerial decisions. Managerial Decisions are decisions taken by managers for the operations of a firm. These decisions include setting target growth rates, hiring or firing employees, and deciding what products to sell. Manager's decisions are taken on the basis of quantitative as well as the qualitative measures. The managerial decision includes the decisions like make or buy, accept or reject new offers, sell or further process etc. These decisions are taken on the basis of relevant costs.
Relevant costs are the costs that are relevant for any decision making. Relevant costs are helpful for take managerial decisions like make or buy, accept or reject new offers, sell or further process etc.
Two basic types of the relevant costs are as follows:
- Out-of-pocket costs
- Opportunity costs
To Indicate:
The type of decision

Want to see the full answer?
Check out a sample textbook solution
Chapter 12 Solutions
SURVEY OF ACCOUNTING W/ACCESS >BI<
- Calculate the standard direct material quantity per unit general accounting question need answerarrow_forwardThe Parks Corporation manufactures and sells Bluetooth speakers. Each speaker sells for $29.50 and the variable cost per unit is $18.75. Parks's total fixed costs are $30,000, and budgeted sales are 6,000 units. What is the contribution margin per unit?arrow_forwardNonearrow_forward
- On April 1, Usain Enterprises purchased machinery at a cost of $150,000, with a depreciable cost of $120,000 and an estimated useful life of 4 years. Using the straight-line depreciation method, calculate depreciation expense for the first year, which ends on December 31. a. $22,500 b. $30,000 c. $15,000 d. $45,000 MCQarrow_forwardPlease solve this General accounting questions step by steparrow_forwardGeneral Accountingarrow_forward
- Survey of Accounting (Accounting I)AccountingISBN:9781305961883Author:Carl WarrenPublisher:Cengage LearningCornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage LearningFinancial Reporting, Financial Statement Analysis...FinanceISBN:9781285190907Author:James M. Wahlen, Stephen P. Baginski, Mark BradshawPublisher:Cengage Learning


