Ch 14 Decision Making Relevant Cost And Benefits

Front 1

accurate information

Back 1

precise correct data

Front 2

avoidable expenses

Back 2

expenses that will no longer be incurred if a particularaction is taken

Front 3

constraints

Back 3

algebraic expressions of limitations fixed by a firm, such as those limiting its productive resources

Front 4

decision variables

Back 4

the variabls in a linear program about which a decision is made

Front 5

differential cost

Back 5

the difference in a cost item under two decision alternatives

Front 6

expected value

Back 6

the sum of the possible values fora random variabl, each weightedby its probablility

Front 7

feasible region

Back 7

the possible valuesfordecision variables that are not ruled by constraints

Front 8

information overload

Back 8

The provision of so much information that, due to human limitations in processing information, managers cannot effectively use it

Front 9

joint cost

Back 9

the cost incurred in a joint production process beforethe joint products become identifiable as separate products

Front 10

joint production process

Back 10

a procudtion process that results in two or more joint products

Front 11

make-or-buy (or outsourcing) decision

Back 11

a decision as to whether a product or service should be produced in-house or purchased from an outside supplier

Front 12

objective function

Back 12

an algebraic expression of the firm's goal

Front 13

opportuinty cost

Back 13

the potential benefit given up when the choice of one action precludes selection of a different action

Front 14

outsourcing (or make or buy) decision

Back 14

a decision as to whether a product or service should be produced in-house or purchased form an outside supplier

Front 15

qualitative characteristics

Back 15

factors in a decision analysis that cannot be expressed easily in numerical terms

Front 16

relative-sales-value method

Back 16

a method in which joint costs are allocated to the joint products in proportion to their totalsales values at the split-off point

Front 17

relevant information

Back 17

data that are pertinent to a decision expects the organization to operate

Front 18

sensitivity analysis

Back 18

a technique for determining what would happen in a decision analysis if a key prediction or assumption proves to be wrong

Front 19

separable processing cost

Back 19

cost incurred on a joint product after the split-off point of a joint production process

Front 20

split-off point

Back 20

the point in a joint production process at which the joint products become identifiable as seprate products

Front 21

sunk costs

Back 21

costs that were incurred in the past and cannot be altered by any current of future decision

Front 22

timely information

Back 22

data that area available in time foruse in a decision analysis

Front 23

unavoiadable expenses

Back 23

expenses that will continue to be incurred even if a subunit or activity is eleminated