Accounting for Decision Making Roland Anderson Is Essay

Open, View, and/or
Download this Document

Total Length: 522 words ( 2 double-spaced pages)

Total Sources: 4

Page 1 of 2

Accounting for Decision Making

Roland Anderson is the manager of the Ekland Division of Ystad Industries and has some decisions to make based on accounting data. Anderson is also being considered for the CEO position of the company which makes his dilemma even greater. He is unhappy with the profitability for the first quarter and is considering maxing out the capacity of the operation in the second quarter. It was found that Anderson actually performed fairly well based on the assumption that his actual costs were below the variable costs provided in the case using the contribution method. Doubling the production plan would be an unwise move given the fact that the sales forecast is only for twenty five thousand units. Thus if he produces fifty thousand units he would have greater inventory and it is likely that he would have to cease operations and let some workers take a vacation or something until the inventory levels are significantly reduced.

Stuck Writing Your "Accounting for Decision Making Roland Anderson Is" Essay?

View All Our Example Accounting for Decision Making Roland Anderson Is Essay

Have A Custom Example Essay Written

Given the fact that Anderson is even considering this strategy implies that he is entirely unfit to be the future CEO.

Contribution Margin Comparison

The following Income Statement was prepared using the contribution margin. Since the variable rate was fifty dollars per unit and the fixed overhead was half a million then the costs of producing twenty five thousand units was $1,750.000. Given the fact that the actual costs under the absorption model were $1,562,000, this works out to a per unit cost of less than fifty dollars per unit with the same level of fixed costs ($42.48).

Ekland Division

Income….....

Show More ⇣

     Open the full completed essay and source list


OR

     Order a one-of-a-kind custom essay on this topic


sample essay writing service

Cite This Resource:

Latest APA Format (6th edition)

Copy Reference
"Accounting For Decision Making Roland Anderson Is" (2012, February 19) Retrieved May 6, 2025, from
https://www.aceyourpaper.com/essays/accounting-decision-making-roland-anderson-78031

Latest MLA Format (8th edition)

Copy Reference
"Accounting For Decision Making Roland Anderson Is" 19 February 2012. Web.6 May. 2025. <
https://www.aceyourpaper.com/essays/accounting-decision-making-roland-anderson-78031>

Latest Chicago Format (16th edition)

Copy Reference
"Accounting For Decision Making Roland Anderson Is", 19 February 2012, Accessed.6 May. 2025,
https://www.aceyourpaper.com/essays/accounting-decision-making-roland-anderson-78031
   

Open, View, and/or
Download this Document
order custom essay example