Is the Opportunity Cost of Idle Capacity Zero? Coase (1938) Versus Managerial Accounting Circa 2000

2001 ◽  
Author(s):  
Ramji Balakrishnan ◽  
K. Sivaramakrishnan ◽  
Shyam Sunder
Keyword(s):  
Opportunity Cost ◽  
Managerial Accounting ◽  
Capacity Zero ◽  
Idle Capacity

Capacity Costs with Time-Based and Use-Based Asset Value Attrition

2011 ◽  
Vol 25 (2) ◽  
pp. 337-356 ◽  
Author(s):  
Marinus DeBruine ◽  
Parvez R Sopariwala
Keyword(s):  
Real World ◽  
Financial Accounting ◽  
Managerial Accounting ◽  
Asset Value ◽  
Wear And Tear ◽  
Resource Costs ◽  
The Cost ◽  
Product Costs ◽  
Depreciation Methods ◽  
Idle Capacity

SYNOPSIS Traditional depreciation methods used by financial accounting as well as the capacity-based depreciation method recommended by managerial accounting literature assume that assets either lose value due to obsolescence or wear and tear. Recognizing that many assets lose value due to both obsolescence and use, Balakrishnan, Sivaramakrishnan, and Sunder, in the September 2004 issue of Accounting Horizons, propose a granularity framework that creates a nonlinear allocation by simultaneously considering an asset's use-based and time-based losses. However, their approach over-allocates and assigns all resource costs to periods before its usefulness has expired. We introduce several adjustments to the Balakrishnan et al. (2004) methodology with the notion of “flexibility value” and a partitioning of the cost of the acquired resources into a time-based and use-based component that avoids any over-allocation of resource costs. This approach also permits a further partitioning of those expired costs into costs that should be allocated to production or products and costs that should be allocated to periods as cost of unused or idle capacity—that is, to produce more accurate product costs for pricing and planning purposes. Finally, we offer a real-world example for partitioning a resource's acquisition cost into a use-based component and a time-based component.

Production capacity of Russian industry: Potential of import Substitution and economic Growth

2015 ◽  
pp. 5-24 ◽  
Author(s):  
B. Zamaraev ◽  
T. Marshova
Keyword(s):  
Economic Growth ◽  
Import Substitution ◽  
Production Capacity ◽  
Current Level ◽  
High Tech ◽  
Industrial Growth ◽  
Russian Industry ◽  
Technological Modernization ◽  
Capacity Structure ◽  
Idle Capacity

The article examines the state of production capacity of Russian industry. It is shown that in spite of certain positive shifts, the rate of technological modernization in recent years has been insufficient for marked progressive changes in the capacity structure and quality. In contrast to the industrial growth after the crisis of 1998 that took place in the presence of significant reserves of capacity, the current level of idle capacity is much lower. The lack of mass input of modern and high-tech industries objectively limits the possibilities of import substitution and economic growth.

Migration vs. development? The case of poverty and inequality in Mexico

2012 ◽  
Vol 9 (1) ◽  
pp. 65-74 ◽  
Author(s):  
Agustín Escobar Latapi
Keyword(s):  
Latin America ◽  
International Migration ◽  
Latin American ◽  
Opportunity Cost ◽  
Inequality Index ◽  
Poverty And Inequality ◽  
And Migration

Although the migration – development nexus is widely recognized as a complex one, it is generally thought that there is a relationship between poverty and emigration, and that remittances lessen inequality. On the basis of Latin American and Mexican data, this chapter intends to show that for Mexico, the exchange of migrants for remittances is among the lowest in Latin America, that extreme poor Mexicans don't migrate although the moderately poor do, that remittances have a small, non-significant impact on the most widely used inequality index of all households and a very large one on the inequality index of remittance-receiving households, and finally that, to Mexican households, the opportunity cost of international migration is higher than remittance income. In summary, there is a relationship between poverty and migration (and vice versa), but this relationship is far from linear, and in some respects may be a perverse one for Mexico and for Mexican households.

Case of New Teaching Method : Flipped Learning in Managerial Accounting Class

2019 ◽  
Vol 28 (1) ◽  
pp. 259-284
Author(s):  
Sora Yoon
Keyword(s):  
Teaching Method ◽  
Flipped Learning ◽  
Managerial Accounting

Managerial Accounting - an Essential Component of the Information System

2018 ◽  
Vol 9 (2) ◽  
pp. 109-114
Author(s):  
Gheorghe Andrei ◽  
Raluca Gâlmeanu ◽  
Florin Radu
Keyword(s):  
Information System ◽  
World Wide ◽  
Third Parties ◽  
Added Value ◽  
Managerial Accounting ◽  
The Past ◽  
Economic Information ◽  
Wide Scale ◽  
Traditional Costing ◽  
New Guidelines

Abstract Accounting it’s an important component of the economic information system. E. Horomnea believes that through specific means and procedures, accounting provides: clarifications of the past and the present of the economic entities, pertinent analyzes that are directed to the market; provides guidance on the strategic future; provides motivations and solutions for the decisions made. This article will analyze the evolution of managerial accounting from traditional costing to the new guidelines, when the issue of creating added value and managing third parties needs represents the future of any information system. After 1987 there are continuous changes and concerns, not only at Romanian level but at world wide scale.

A Study On Comparison About Working Capital Management Of State Bank Of India And Industrial Credit And Investement Corporation Of India

Think India ◽  
2019 ◽  
Vol 22 (2) ◽  
pp. 251-276
Author(s):  
S. DEVI ◽  
R.POORNIMA RANI
Keyword(s):  
Main Theme ◽  
Managerial Accounting ◽  
Capital Management ◽  
Working Capital ◽  
Current Ratio ◽  
Efficient Operation ◽  
Working Capital Management ◽  
Satisfactory Level ◽  
Current Asset

Working capital management refers to a company's managerial accounting strategy designed to monitor and utilize the two components of working capital, current assets and current liabilities, to ensure the most financially efficient operation of the company. The goal of working capital management is to manage the firm’s current asset and current liabilities in such a way that satisfactory level of working capital is maintained. A study on comparison in working capital management with State Bank of India and Industrial Credit and Investment Corporation of India is analyzed to know the liquidity and current ratio. The interaction between current asset and current liabilities is therefore is the main theme of the theory of working capital management.

On Measuring the Social Opportunity Cost of Labour in the Presence of Tariffs and an Informal Sector (The Distinguishedl Lecture)

1992 ◽  
Vol 31 (4I) ◽  
pp. 535-564 ◽  
Author(s):  
M. Ali Khan
Keyword(s):  
Informal Sector ◽  
Opportunity Cost ◽  
Costs And Benefits ◽  
Open Letter ◽  
Review Of The Literature ◽  
The Social ◽  
Action Project ◽  
Relevant Group ◽  
Net Benefits ◽  
The Individual

Harberger introduced his influential 1971 essay with the following words. This paper is intended not as a scientific study, nor as a review of the literature, but rather as a tract - an open letter to the profession, as it were - pleading that three basic postulates be accepted as providing a conventional framework for applied welfare economics. The postulates are: (a) The competitive demand price for a given unit measures the value of that unit to the demander; (b) The competitive supply price for a given unit measures the value of that unit to the supplier; and (c) When evaluating the net benefits or costs of a given action (project, programme, or policy), the costs and benefits accruing to each member of the relevant group (e.g., a nation) should normally be added without regard to the individual(s) to whom they accrue.

Welfare tradeoff psychology is present in children and adults

2018 ◽  
Author(s):  
Rhea M Howard ◽  
Annie C. Spokes ◽  
Samuel A Mehr ◽  
Max Krasnow
Keyword(s):  
Social Networks ◽  
Social Context ◽  
Opportunity Cost ◽  
Trade Off ◽  
Contextual Features ◽  
Limited Experience ◽  
The Individual

Making decisions in a social context often requires weighing one's own wants against the needs and preferences of others. Adults are adept at incorporating multiple contextual features when deciding how to trade off their welfare against another. For example, they are more willing to forgo a resource to benefit friends over strangers (a feature of the individual) or when the opportunity cost of giving up the resource is low (a feature of the situation). When does this capacity emerge in development? In Experiment 1 (N = 208), we assessed the decisions of 4- to 10-year-old children in a picture-based resource tradeoff task to test two questions: (1) When making repeated decisions to either benefit themselves or benefit another person, are children’s choices internally consistent with a particular valuation of that individual? (2) Do children value friends more highly than strangers and enemies? We find that children demonstrate consistent person-specific welfare valuations and value friends more highly than strangers and enemies. In Experiment 2 (N = 200), we tested adults using the same pictorial method. The pattern of results successfully replicated, but adults’ decisions were more consistent than children’s and they expressed more extreme valuations: relative to the children, they valued friends more and valued enemies less. We conclude that despite children’s limited experience allocating resources and navigating complex social networks, they behave like adults in that they reference a stable person-specific valuation when deciding whether to benefit themselves or another and that this rule is modulated by the child’s relationship with the target.

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