Strategic Management Accounting

A: “Both Return on Investment (ROI) and Economic Value Added (EVA), when used as performance measures in an organisation, encourage managers to be short-term in their focus and decision making”.

B:  Organisations need to know the cost of products or services they provide for a variety of decision making situations. Critically evaluate the following three approaches to costing products or services.

1. Marginal or variable costing

2. Full or Absorption costing

3. Activity based costing (ABC)

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