Module 03: Cost Analysis for Decision-Making
Costing Framework for Decision Making
Introduction Let us start our discussion with a costing framework suitable for decision making. ...
Behavior of Cost
Introduction We started our discussion on fixed and variable costs and how they influence cost. ...
Break-even Analysis
Introduction Your friend owns an ice-cream shop. She is concerned because two more shops have op...
BEP Analysis in Multiproduct Situation
Single-Product BEP: Fortune Pharma Example Selling Price: ₹240 per case Variable Cost: ₹200 pe...
Pricing Decision
Importance of Pricing Strategy Pricing is crucial in competitive markets. Aggressive pricing bo...
Make or Buy Decision
Facing Competition Through Cost Leadership Firms achieve cost leadership by: Outsourcing non-c...
Discontinuing Product or Closing Down Division
Why Do Firms Close Down Products or Divisions? Due to negative contribution (sales price < varia...
Optimal Product Mix
Ideal vs Real World Ideal World: Unlimited resources Equal contribution margins All customer o...
Measuring Operating Risk
Why Talk About Risk? So far, we focused on maximizing contribution margin. But business also invo...