Unitron Corporation: Teaching Commentary

OVERVIEW This is an excellent short fount to introduce the managerial accountancy issues related to the go cost problem. Classic microeconomics argues unequivocally that attempts to buy off cost to separate products in a mutual define constitute a complete waste of time-- meet maximize the total revenue over the batch. Like the comparable apothegm to price so that marginal cost equals marginal revenue, the economists advice just nigh joint costing is certainly accurate, given the assumptions, nonwithstanding non particularly useful in practice. Most managerial accountants, including this author, leave that there be important managerial issues involved in accounting for joint cost in real companies. This case superlatives those issues for a real company. headers 1, 2, and 3 consider the calculation aspects of the issue. heading 5 considers what cost system to use, emphasizing behavioral considerations. doubts 3 and 4 address decision making under jo int costing--how to think about cost when trying to maximize profit. Question 6 blends cost analysis and strategic positioning in a cost plus contracting situation. TEACHING outline We teach the case in hotshot (90 minute) class catch early in the required managerial accounting course. Questions 1 through 5 go out easily fill one class period with useful discussion. We push hard to cover these headings in about 75 minutes so that we mickle also go past some time on principal 6.

This last question raises strategic positioning issues piece reinforcing the accounting issues from the first five dollar bil l questions. We swear it is important to r! einforce with the students the idea that strategic issues are ever so relevant to the managerial accounting issues, even in the joint cost context. The defense contracting setting for question 6 heightens the costing dilemma--the assignment of joint cost to individual products is not supposed to be useful for decision-making, but the disposal will only accept a cost-based... If you want to trance a full essay, order it on our website: BestEssayCheap.com

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