Lecture notes
CIMA BA2 Notes Chapter 13 - Short-term decision making
CIMA BA2 Notes Chapter 13 - Short-term decision making
[Show more]
Content preview
1BA 2 - Fundamentals of Management Accounting
Short-term decision making
Chapter thirteen
BA 2 Short-term decision making. Quantia Learning
, 2
BA 2 Short-term decision making. Quantia Learning
, 3
We will consider some short-term decision making techniques in more detail.
Some common short-term decisions which organisations make are:
• Pricing decisions for a one-off product or job.
• How many units to produce and sell – this is
known as breakeven analysis.
• Limiting factor decision – where the company
tries to operate at the maximum profitability
despite being constrained in some way.
• Make or buy decisions – where a company
decides whether to make components in house,
or buy them from an external supplier.
Decision making will involve many of the techniques that we have already looked at earlier like
relevant cosing, the calculation of contribution, and risk and uncertainty which will have an
impact on decision making.
Pricing decisions for a one-off product or job
Remember that in all decision making the rules of relevant cost apply.
When making a one-off pricing decision only relevant cash flows should be used.
BA 2 Short-term decision making. Quantia Learning
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller ellewoods2. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for £5.49. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
79271 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy revision notes and other study material for 14 years now
