Decision Making Techniques in Managerial Accounting

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Managerial accounting comprises all the financial information needed to help managers make educated decisions and do their job duties efficiently. A typical manager’s responsibilities with managerial accounting include interpreting finance reports and projections and using those to make financial decisions that will affect the company. Since managers have to make routine decisions and finalize reports periodically, it is vital that they are able to conduct healthy decision making processes and are able to come to make quick educated conclusions. While there are plenty of decision making models to utilize with business situations, when it comes to making maximizing decisions the best one to use is the rational decision-making model. BSE Veterinary Services current issue at hand is how to handle the projected influx of 6,000 extra tests that will have to be performed to measure the rate of cattle infection in the next projected period. Well they are well prepared for the current rate of 12,000 tests, considerations have to be taken into key if the projected rates continue to grow. In order to prepare for this projection, there are several considerations to take into account such as increased production costs and how to handle technician workload. In order to make a well-rounded decision on moving forward with viable resolutions, it would be best to utilize a decision making model to measure viable criteria and come forth with a well thought out conclusion (Walker, 2009). The best decision making model to use in this situation would be the rational decision-making model, since the main objective is to maximize the potential outcome and research and time constraints are open for clarification. The rational decision-making mod... ... middle of paper ... ...ll make all the difference in how well they will be able to make their choices. For many decisions, every alternative will not need to be brainstormed but when choices need to be made that will affect future finances it is important that there is a procedure in place to assist in making the decision a good one. Works Cited Bauer, T., & Erdogan, B. (2010). Organizational Behavior Version 1.1. Irvington, NY: FlatWorld Knowledge, Inc. Corporate Executive Board. (2011, December). Preventing 'Analysis Paralysis'. Retrieved from Bloomberg Businessweek: http://www.businessweek.com/management/preventing-analysis-paralysis-12202011.html Hammond, J. S., Keeney, R. L., & Raiffa, H. (1998). The Hidden Traps in Decision Making. Harvard Business Review, 76(5), 47-58. Walker, J. (2009). Accounting in a Nutshell: Accounting for the Non-specialist. Amsterdam: Elsevier/CIMA.

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