Analytical Contribution Accounting: The Interface of Cost Accounting and Pricing Policy

by Walter Georges, Robert McGee

Overview

Business success or failure is often determined by decisions made in establishing selling prices for products and services. . . . In this clear and readable work, the authors present a good summary of the literature on pricing policy, emphasizing the relevance of costs. They propose a system that involves analyzing indirect costs to distinguish those that may be relevant to pricing in some circumstances but not others. This ‘analytical contribution accounting' has promise as a tool for many businesses. Students writing papers on costs and pricing policy would find this volume a useful starting point. The bibliography is good. . . . College and university collections.

Using practical examples and simple language, this book develops an accounting system that is a new and functional key to making product pricing decisions. This accounting system, which bridges the gap between full and direct costing, is called Analytical Contribution Accounting. Georges and McGee demonstrate practically as well as theoretically why it is so superior for pricing purposes. The system is based on the relativity aspects implicit in the direct cost method, and on the calculations of a set of differentiated contributions.

Product Details

ISBN-13:	9780899302096
Publisher:	Bloomsbury Academic
Publication date:	03/12/1987
Pages:	270
Product dimensions:	6.14(w) x 9.21(h) x 0.62(d)

About the Author

WALTER GEORGES is a full time lecturer in Accounting at the Institute for Business Management, Ghent, and is a Consultant in Cost Accounting, Financial Analysis, and Budgeting.

ROBERT W. MCGEE is Associate Professor of Accounting at Seton Hall University, New Jersey, and has a consulting practice in the New York area.

Table of Contents

General Aspects of Pricing Policy
General Considerations About Pricing Policy
The Determinants of Pricing Policy
Pricing Behavior
Pricing Strategies
Cost as Price Determinant
General Remarks About the Relation Between Cost Accounting and Pricing Policy
Cost Concepts Relevant to Pricing Policy
The Role of Cost Accounting Information in Determining Price Floors
The Role of Cost Accounting Information in Price Differentiation
The Role of Cost Accounting Information in Case of Price Changing
The Role of Cost Accounting Information in Case of Pricing Individualized Products (Job Order Costing)
Cost-Oriented Methods of Price Determination
Pricing Decisions Based on Full Costing
Pricing Decisions Based on Partial Costing
Pricing Decisions Based on Cost Accounting Methods in between Full Costing and Partial Costing
Analytical Contribution Accounting and Pricing Policy
Motives for the Choice of Analytical Contribution Accounting (ACA)
Fundamental Principles of Analytical Contribution Accounting
Methodolgy of Analytical Contribution Accounting
Pricing Policy-Oriented Calculation Models
Bibliography
Index