Chapter 9 - Incremental analysis. After studying this chapter, you should be able to: Identify the steps in management’s decision-making process, describe the concept of incremental analysis, identify the relevant costs in accepting an order at a special price, indicate the relevant costs in a make-or-buy decision,. | John Wiley & Sons, Inc. Prepared by Karleen Nordquist The College of St. Benedict. and St. John’s University. with contributions by Marianne Bradford The University of Tennessee. Gregory K. Lowry . Macon Technical Institute Managerial Accounting Weygandt, Kieso, & Kimmel Chapter 9 Incremental Analysis After studying this chapter, you should be able to: 1 Identify the steps in management’s decision-making process. 2 Describe the concept of incremental analysis. 3 Identify the relevant costs in accepting an order at a special price. 4 Indicate the relevant costs in a make-or-buy decision. 5 Give the decision rule in deciding whether to sell or process materials further. Chapter 9 Incremental Analysis After studying this chapter, you should be able to: 6 Identify the factors to be considered in retaining or replacing equipment. 7 Explain the factors that are relevant in deciding whether to eliminate an unprofitable segment. 8 Explain the term “sales mix” and its effects in . | John Wiley & Sons, Inc. Prepared by Karleen Nordquist The College of St. Benedict. and St. John’s University. with contributions by Marianne Bradford The University of Tennessee. Gregory K. Lowry . Macon Technical Institute Managerial Accounting Weygandt, Kieso, & Kimmel Chapter 9 Incremental Analysis After studying this chapter, you should be able to: 1 Identify the steps in management’s decision-making process. 2 Describe the concept of incremental analysis. 3 Identify the relevant costs in accepting an order at a special price. 4 Indicate the relevant costs in a make-or-buy decision. 5 Give the decision rule in deciding whether to sell or process materials further. Chapter 9 Incremental Analysis After studying this chapter, you should be able to: 6 Identify the factors to be considered in retaining or replacing equipment. 7 Explain the factors that are relevant in deciding whether to eliminate an unprofitable segment. 8 Explain the term “sales mix” and its effects in determining break-even sales. 9 Determine sales mix when a company has limited resources. Chapter 9 Incremental Analysis Preview of Chapter 9 Decision-Making Process Incremental Analysis Approach How Incremental Analysis Works Types of Incremental Analysis Accept an Order at a Special Price Make or Buy Sell or Process Further Retain or Replace Equipment Eliminate an Unprofitable Segment INCREMENTAL ANALYSIS Preview of Chapter 9 Sales Mix Break-even Sales Limited Resources Other Considerations Qualitative Factors Incremental Analysis and ABC INCREMENTAL ANALYSIS Identify the steps in management’s decision-making process. Study Objective 1 Management’s Decision-Making Process Management’s decision-making process frequently involves the following steps: 1 Identify the problem and assign responsibility. 2 Determine and evaluate possible courses of action. 3 Make a decision. 4 Review results of the decision. Management’s Decision-Making Process In making decisions, management ordinarily .
