Abstract
For managers to be able to choose between alternative business opportunities, they need information regarding future costs and revenues and the way in which these may vary at different levels of activity. In order to use this information effectively, in the business environment, they also need to understand how costs are determined and the way in which costs and revenues behave.
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References
Arnold, J. and Hope, T. (1990) Accounting for Management Decisions,2nd edn, Prentice-Hall.
Hongren, C. and Foster, G. (1991) Cost Accounting - A Managerial Emphasis,7th edn, Prentice-Hall.
Slater, R. and Ascroft, P. (1990) Quantitative Techniques in a Business Context,Chapman and Hall.
Further reading
For a more detailed analysis of methods of cost estimation reference can be made to Horngren and Foster (1991).
Another book in this series, Economics in a Business Context (1989), examines curvilinear cost functions from an economics perspective in Chapter 4.
The CVP model that we have examined ignores risk and uncertainty, which will inevitably be relevant in practice. This aspect is considered in Managerial Accounting: Method and Meaning by R.M.S. Wilson and W.F. Chua (Chapman Hall, 1992), 2nd edn, Chapter 4.
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© 1994 Aidan Berry and Robin Jarvis
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Berry, A., Jarvis, R. (1994). Cost behaviour and cost-volume-profit analysis. In: Accounting in a Business Context. Business in Context Series. Springer, Boston, MA. https://doi.org/10.1007/978-1-4899-6942-2_15
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DOI: https://doi.org/10.1007/978-1-4899-6942-2_15
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