成本与管理会计（第15版）课件汇 ch12-23 Strategy,Balanced Scorecard-Performance Measurement,Compensation

CHAPTER12Strategy,BalancedScorecard,andStrategicProfitabilityAnalysisChapter12learningobjectivesRecognizewhichoftwogenericstrategiesacompanyisusingUnderstandwhatcomprisesreengineeringUnderstandthefourperspectivesofthebalancedscorecardAnalyzechangesinoperatingincometoevaluatestrategyIdentifyunusedcapacityandhowtomanageit12-2StrategyStrategyspecifieshowanorganizationmatchesitsowncapabilitieswiththeopportunitiesinthemarketplacetoaccomplishitsobjectives.Strategydescribeshowanorganizationcancreatevalueforitscustomerswhiledifferentiatingitselffromitscompetitors.Athoroughunderstandingoftheindustryiscriticaltoimplementingasuccessfulstrategy.Industryanalysisfocuseson5forces.12-3IndustryanalysisfocusesonfiveforcesNumberandstrengthofcompetitorsPotentialentrantstothemarketAvailabilityofequivalentproductsBargainingpowerofcustomersBargainingpowerofinputsuppliers12-4TwoBasicBusinessStrategiesProductdifferentiation—anorganization’sabilitytoofferproductsorservicesperceivedbyitscustomerstobesuperioranduniquerelativetotheproductsorservicesofitscompetitors.Competitiveadvantage:brandloyaltyandthewillingnessofcustomerstopayhighprices.Costleadership—anorganization’sabilitytoachievelowercostsrelativetocompetitorsthroughproductivityandefficiencyimprovements,eliminationofwaste,andtightcostcontrol.Competitiveadvantage:lowersellingprices.12-5reengineeringReengineeringisthefundamentalrethinkingandredesignofbusinessprocessestoachieveimprovementsincriticalmeasuresofperformance,suchascost,quality,service,speedandcustomersatisfaction.Statedanotherway,reengineeringistheredesignofbusinessprocessestoimproveperformancebyreducingcostandimprovingquality.12-6ImplementationofStrategyManycompanieshaveintroducedabalancedscorecardtotrackprogressandmanagetheimplementationoftheirstrategies.12-7TheBalancedScorecardThebalancedscorecardtranslatesanorganization’smissionandstrategyintoasetofperformancemeasuresthatprovidestheframeworkforimplementingitsstrategy.1Notonlydoesthebalancedscorecardfocusonachievingfinancialobjectives,italsohighlightsthenonfinancialobjectivesthatanorganizationmustachievetomeetandsustainitsfinancialobjectives.Thescorecardmeasuresanorganization’sperformancefromfourperspectives.12-8ThefourPerspectivesofaBalancedScorecardFinancial-profitsandvaluecreatedforshareholdersCustomer–thesuccessofthecompanyinitstargetmarketInternalbusinessperspective–theinternaloperationsthatcreatevalueforcustomersLearningandgrowth–thepeopleandsystemscapabilitiesthatsupportoperationsTheparticularmeasureacompanyusestotrackperformancewilldependonitsstrategy.12-9Strategymaps12-10Fourperspectives:FinancialEvaluatestheprofitabilityofthestrategyUsesthemostobjectivemeasuresinthescorecardTheotherthreeperspectiveseventuallyfeedbackintothisdimension12-11Fourperspectives:customerIdentifiestargetedcustomerandmarketsegmentsandmeasuresthecompany’ssuccessinthesesegments12-12fourPerspectives:InternalBusinessFocusesoninternaloperationsthatcreatevalueforcustomerswhich,inturn,willfurtherthefinancialperspectivebyincreasingshareholdervalueIncludesthreesubprocesses:InnovationOperationsPost-salesservice12-13fourPerspectives:InternalBusiness,concluded12-14FourPerspectives:LearningandGrowthIdentifiesthepeopleandinformationcapabilitiestheorganizationmustexcelattoachievesuperiorinternalprocessesthatcreatevalueforcustomersandshareholders12-15BalancedScorecardImplementationMusthavecommitmentandleadershipfromtopmanagement.Mustbecommunicatedtoallemployees.Forthebalancedscorecardtobeeffective,managersmustviewitasafairwaytoassessandrewardallimportantaspectsofamanager’sperformanceandpromotionprospects.12-16CommonBalancedScorecardMeasures12-17Environmentalandsocialperformanceandthe

balancedscorecardCompaniesareincreasinglyrecognizingthattheymustearntherighttooperateinthecommunitiesandcountriesinwhichtheydobusiness.Failuretoperformadequatelyonenvironmentalandsocialprocessesputsatriskacompany’sabilitytodeliverfuturevaluetoshareholders.12-18Environmentalandsocialperformanceandthe

balancedscorecard,cont’dAswasdiscussedinChapter1,manymanagersarepromotingsustainability(thedevelopmentandimplementationofstrategies)toachieve:Long-termfinancialperformanceSocialperformance(eliminatingemployeeinjuries,improvingproductsafety)Environmentalperformance(reducinggreenhousegasemissions)12-19Environmentalandsocialperformanceandthe

balancedscorecard,concludedManagersinterestedinmeasuringenvironmentalandsocialperformanceareincorporatingthesefactorsintotheirbalancedscorecardstosetprioritiesforinitiatives,guidedecisionsandactionsandfueldiscussionsaroundstrategiesandbusinessmodelstoimproveperformance.Companiesuseavarietyofmeasuresincluding: Costofpreventingandremediatingenvironmentaldamage(financial);brandimage(customer);energyconsumption(internal-business);andimplementationofISO14000environmentalstandards(learningandgrowth).12-20FeaturesofaGood

BalancedScorecard1.Tellsthestoryofafirmsstrategy,articulatingasequenceofcause-and-effectrelationships—thelinksamongthevariousperspectivesthatalignimplementationofthestrategy.2.Helpstocommunicatethestrategytoallmembersoftheorganizationbytranslatingthestrategyintoacoherentandlinkedsetofunderstandableandmeasurableoperationaltargets.12-21FeaturesofaGood

BalancedScorecard,cont’d3.Mustmotivatemanagerstotakeactionsthateventuallyresultinimprovementsinfinancialperformance.Appliesprimarilytofor-profitentities,buthassomeapplicationtonot-for-profitentitiesaswell.4.Limitsthenumberofmeasures,identifyingonlythemostcriticalones.5.Highlightsless-than-optimaltrade-offsthatmanagersmaymakewhentheyfailtoconsideroperationalandfinancialmeasurestogether.12-22PitfallsinimplementingabalancedscorecardManagersshouldnotassumethecause-and-effectlinkagesareprecise:theyaremerelyhypotheses.Managersshouldnotseekimprovementsacrossallofthemeasuresallofthetime.Managersshouldnotuseonlyobjectivemeasures:subjectivemeasuresareimportantaswell.Despitechallengesofmeasurement,topmanagementshouldnotignorenonfinancialmeasureswhenevaluatingmanagersandotheremployees.12-23EvaluatingthesuccessofStrategyandimplementationToevaluatehowsuccessfulacompany’sstrategyandimplementationhavebeen,itsmanagementmustcomparethetargetandactualperformancecolumnsinthebalancedscorecard.Ifacompanydoesnotmeetitstargetsonthetwoperspectivesthataremoreinternallyfocused(learningandgrowth,andinternalbusinessprocesses),itmayhavehadaproblemwithstrategyimplementation.Ifacompanyperformswellintheinternallyfocusedperspectivesbutnotcustomerandfinancialmeasures,itmayconcludethatthestrategywasfaultybecausetherewasnoeffectoncustomersoronlong-runfinancialperformanceandvaluecreation.12-24StrategicanalysisofoperatingincomeStrategicanalysisofoperatingincome—threeparts:Growthcomponent—measurestheincreaseinrevenuesminustheincreaseincostsfromsellingmoreunitsinthecurrentyearthanintheprioryear,assumingnothingelsehaschanged.Price-recoverycomponent—measuressolelytheeffectofpricechangesonrevenuesandcoststoproduceandsellthecurrentyearquantity.12-25Strategicanalysisofoperatingincome,concludedStrategicanalysisofoperatingincomeProductivitycomponent—measureshowcostshavechangedasaresultofusingfewer/moreinputs,abetter/worsemixofinputs,and/ormore/lesscapacitytoproducecurrentyearoutputcomparedwiththeinputsandcapacitythatwouldhavebeenusedtoproducethisoutputintheprioryear.12-26RevenueEffectofGrowthRevenueEffectofGrowthActualUnitsofOutputSoldintheCurrentPeriodActualUnitsofOutputSoldinthePriorPeriod=X_PriorPeriodSellingPrice12-27Throughouttheseslides,we’llusevaluesfromthetextbookexampletoillustratetheformulas:Here,actualunitsofoutputsoldinthecurrentperiodare1,150,000;Actualunitsofoutputsoldinthepriorperiodare1,000,000,andThesellingpriceinthepriorperiodwas$23/unit,therefore:(1,150,000–1,000,000)x$23=$3,450,000FRevenueEffectofGrowthCostEffectofGrowthfor

VariableCostsCostEffectofGrowthforVariableCostsUnitsofInputRequiredtoProduceCurrentOutputinthePriorPeriodActualUnitsofInputUsedtoProducePriorPeriodOutput=X_PriorPeriodInputPrice12-283,000,000sqcmx(1,150,000/1,000,000)–3,000,000sqcmx$1.40inputprice=$630,000UnfavorableThecosteffectofgrowthmeasureshowmuchcostswouldhavechangedintheprioryearifproductionwouldhavebeenatcurrentyearlevels.ThisisdoneseparatelyforVariableandFixedcosts.CostEffectofGrowthfor

FixedCosts12-29Assumingadequatecurrentcapacity:(3,750,000sqcm–3,750,000sqcm)X$4.28persqcm=$0.00RevenueEffectofPriceRecovery12-30($22perunitcurrentyear-$23perunitprioryear)X1,150,000actualunitsofoutputsoldincurrentyear=$1,150,000UnfavorableCostEffectofPriceRecoveryforvariablecosts12-31($1.50persqcmcurrentyear-$1.40persqcmprioryear)X3,450,000sqcmrequiredforcurrentyearoutputinprioryear=$345,000UnfavorableCostEffectofPriceRecoveryforfixedcosts12-32Assumingadequatecurrentcapacity:$4.35persqcm-$4.28persqcm)X3,750,000sqcm=$262,500UnfavorableCostEffectofProductivityforVariableCosts12-33(2,900,000sqcmforcurrentperiodoutput–3,450,000sqcmforcurrentperiodoutputinpriorperiod)X$1.50persqcm=$825,000FavorableCostEffectofProductivityforfixedCosts12-34Assumingadequatecurrentcapacity:(3,500,000sqcm–3,750,000sqcm)X$4.35persqcm=$1,087,500FavorableFurtheranalysisofgrowth,price-recoveryandproductivitycomponents12-35Consistentwithacost-leadershipstrategy,theproductivitygainsof$1,912,500in2013wereabigpartoftheincreaseinoperatingincomeforprioryeartocurrentyear.Underdifferentassumptionsaboutthechangeinsellingprice,theanalysiswillattributedifferentamountstothedifferentstrategies.DownsizingandthemanagementofprocessingCapacityManagerscanreducecapacity-basedfixedcostsbymeasuringandmanagingunusedcapacity.Unusedcapacityistheamountofproductivecapacityavailableoverandabovetheproductivecapacityemployedtomeetconsumerdemandinthecurrentperiod.Tobetterunderstandthisconceptofunusedcapacity,itisnecessarytodistinguishengineeredcostsfromdiscretionarycosts.12-36AnalysisofUnusedCapacity:

engineered&discretionarycostsEngineeredcostsresultfromacause-and-effectrelationshipbetweenthecostdriver(output)andthe(directorindirect)resourcesusedtoproducethatoutput.Engineeredcostshaveadetailed,physicallyobservableandrepetitiverelationshipwithoutput.Discretionarycostshavetwoimportantfeatures:Theyarisefromperiodic(usuallyannual)decisionsregardingthemaximumamounttobeincurred.Theyhavenomeasurablecause-and-effectrelationshipbetweenoutputandresourcesused.12-37ManagingUnusedCapacityDownsizing(rightsizing)isanintegratedapproachofconfiguringprocesses,products,andpeopletomatchcoststotheactivitiesthatneedtobeperformedtooperateeffectivelyandefficientlyinthepresentandfuture.Downsizingoftenmeanseliminatingjobs,whichcanadverselyaffectemployeemoraleandthecultureofacompany.12-38TermstolearnTERMSTOLEARNPAGENUMBERREFERENCEBalancedscorecardPage476CostleadershipPage474DiscretionarycostsPage496DownsizingPage497EngineeredcostsPage496GrowthcomponentPage489PartialproductivityPage503Price-recoverycomponentPage489ProductdifferentiationPage474ProductivityPage50312-39TermstolearnTERMSTOLEARNPAGENUMBERREFERENCEProductivitycomponentPage489ReengineeringPage475RightsizingPage497StrategymapPage477TotalfactorproductivityPage504UnusedcapacityPage49612-4041CHAPTER13PricingDecisionsandCostManagementChapter13learningobjectivesDiscussthethreemajorfactorsthataffectpricingdecisionsUnderstandhowcompaniesmakelong-runpricingdecisionsPriceproductsusingthetarget-costingapproachApplytheconceptsofcostincurrenceandlocked-incostsPriceproductsusingthecost-plusapproach13-43Chapter13learningobjectives,concludedUselife-cyclebudgetingandcostingwhenmakingpricingdecisionsDescribetwopricingpracticesinwhichnoncostfactorsareimportantExplaintheeffectsofantitrustlawsonpricing13-44MajorfactorsthataffectPricingdecisionsHowcompaniespriceaproductorserviceultimatelydependsonthedemandandsupplyforit.Threeinfluencesondemandandsupplyare:CustomersCompetitorsCosts13-45InfluencesonDemandandSupplyCustomers—influencepricethroughtheireffectonthedemandforaproductorservice,basedonfactorssuchasproductfeaturesandquality.Competitors—influencepricethroughtheirtechnologies,plantcapacitiesandoperatingstrategieswhichaffecttheircosts.Costs—influencepricesbecausetheyaffectsupply(thelowerthecost,thegreaterthequantityafirmiswillingtosupply).13-46CostingandPricingforthelong-runShort-runpricingdecisionshaveatimehorizonoflessthanoneyearandincludedecisionssuchas:Pricingaone-time-onlyspecialorderwithnolong-runimplicationsAdjustingproductmixandoutputvolumeinacompetitivemarket.Long-runpricingisastrategicdecisiondesignedtobuildlong-runrelationshipswithcustomersbasedonstableandpredictableprices.Managerspreferastableprice.13-47CostallocationRecallthatindirectcostsofaparticularcostobjectarecoststhatarerelatedtothatcostobjectbutcannotbetracedtoitinaneconomicallyfeasible(cost-effective)way.Thesecostsoftencomprisealargepercentageoftheoverallcostsassignedtocostobjects.Costallocationsinfluencemanagers’costmanagementdecisionsaswellastheproductsthatmanagerspromote.13-48Purposesofcostallocation13-49AlternativeLong-RunPricingApproachesHowshouldmanagersuseproductcostinformationtopricetheirproducts?Therearetwodifferentapproachesforpricingdecisions:TheMARKET-BASEDAPPROACH asks:Givenwhatourcustomerswantandhowcompetitorswillreacttowhatwedo,whatpriceshouldwecharge?TheCOST-BASEDAPPROACHasks:Givenwhatitcostsustomakethisproduct,whatpriceshouldwechargethatwillrecoupourcostsandachieveatargetreturnoninvestment?13-50MarketsandPricingCompaniesoperateindifferentmarketswhichaffecttheapproachthey’lluseforpricing:CompaniesoperatinginCOMPETITIVEMARKETSusethemarket-basedapproach.Companiesinthesemarketsmustacceptthepricessetbythemarket(goodsorservicesprovidedbycompetitorsareverysimilar)13-51MarketsandPricing,cont’dCompaniesoperateindifferentmarketswhichaffecttheapproachthey’lluseforpricing:CompaniesoperatinginLESS-COMPETITIVEMARKETSofferproductsorservicesthatdifferfromeachotherandcanuseeitherthemarket-basedorcost-basedapproachasthestartingpointforpricingdecisions.Remember,bothapproachesconsidercustomers,competitorsandcosts.Onlythestartingpointsdiffer.Managersshouldalwayskeepinmindmarketforcesregardlessofwhichpricingapproachtheyuse.13-52MarketsandPricing,concludedCompaniesoperateindifferentmarketswhichaffecttheapproachthey’lluseforpricing:CompaniesoperatinginmarketsthatareNOTCOMPETITIVEfavorcost-basedapproachesbecausethesecompaniesdonotneedtorespondorreacttocompetitors’prices.13-53Understandingthe

MarketEnvironmentBeforesettingpricesunderanyapproach,managersneedtounderstandcustomersandcompetitorsforthreereasons:Lower-costcompetitorscontinuallyrestrainprices.Productshaveshorterlives,whichleavescompanieslesstimeandopportunitytorecoverfrompricingmistakes,lossofmarketshareandlossofprofitability.Customersaremoreknowledgeablebecausetheyhaveeasyaccesstopriceandotherinformationonlineanddemandhigh-qualityproductsatlowprices.13-54Market-BasedApproach:

targetcostingfortargetpricingStartswithatargetpricewhichistheestimatedpriceforaproductorservicethatpotentialcustomersarewillingtopayThetargetpriceisestimatedbasedonanunderstandingofcustomers’perceivedvalueforaproductorservice,andHowcompetitorswillpricecompetingproductsorservices.13-55Implementing

TargetPricingandTargetCosting:fivestepsDevelopaproductthatsatisfiestheneedsofpotentialcustomers.Chooseatargetprice.DeriveatargetcostperunitbysubtractingtargetoperatingincomeperunitfromthetargetpricePerformcostanalysis.Performvalueengineeringtoachievetargetcost.13-56ValueEngineeringValueengineeringisasystematicevaluationofallaspectsofthevaluechain,withtheobjectiveofreducingcostsandachievingaqualitylevelthatsatisfiescustomers.Valueengineeringentailsimprovementsinproductdesigns,changesinmaterialsspecificationsandmodificationsinprocessmethods.Toimplementvalueengineering,managersmustdistinguishvalue-addedactivitiesandcostsfromnon-value-addedactivitiesandcosts.13-57ValueEngineeringTerminologyValue-addedcosts—acostthat,ifeliminated,wouldreducetheactualorperceivedvalueorutility(usefulness)customersexperiencefromusingtheproductorservice.Non-value-addedcosts—acostthat,ifeliminated,wouldnotreducetheactualorperceivedvalueorutility(usefulness)customersgainfromusingtheproductorservice.Itisacostthecustomerisunwillingtopayfor.

(Examplesincludethecostofdefectiveproductsandmachinebreakdowns.)13-58ValueEngineeringTerminology,concludedCostincurrence—describeswhenaresourceisconsumed(orbenefitforegone)tomeetaspecificobjective.Locked-incosts(designed-incosts)—arecoststhathavenotyetbeenincurredbutwillbeincurredinthefuture

basedondecisionsthathavealreadybeenmade.Thebestopportunitytomanagecostsisbeforetheyarelockedin.13-59CostIncurrence

andLocked-InCostsGraph13-60PossibleundesirableeffectsofValueEngineeringandTargetCostingUnlessmanagedproperly,valueengineeringandtargetcostingcanhaveundesirableeffects:Employeesmayfeelfrustratediftheyfailtoattaintargets.Thecross-functionalteammayaddtoomanyfeaturesjusttoaccommodatethedifferentwishesofteammembers.Aproductmaybeindevelopmentforalongtimeastheteamrepeatedlyevaluatesalternativedesigns.Organizationalconflictsmaydevelopastheburdenofcuttingcostsfallsunequallyondifferentbusinessfunctionsinthecompany’svaluechain.13-61AvoidingpossibleundesirableeffectsToavoidthosepossibleundesirableeffects,target-costingeffortsshouldalways:Encourageemployeeparticipationandcelebratesmallimprovementstowardachievingthetargetcost.Focusonthecustomer.Payattentiontoschedules.Setcost-cuttingtargetsforallvalue-chainfunctionstoencourageacultureofteamworkandcooperation.13-62Targetpricingapproachandfive-stepdecision-makingprocessThetargetpricingapproachisanotherillustrationofthefive-stepdecision-makingprocessintroducedinChapter1:Identifytheproblemanduncertainties.Obtaininformation.Makepredictionsaboutthefuture.MakedecisionsbychoosingamongalternativesImplementthedecision,evaluateperformanceandlearn.13-63Cost-plusPricingInsteadofusingthemarket-basedapproachforlong-runpricingdecisions,managerssometimesuseacost-basedapproachThegeneralformulaforsettingacost-basedsellingpriceaddsamarkupcomponenttothecostbase.Usually,itisonlyastartingpointintheprice-settingprocess.Markupissomewhatflexible,basedpartiallyoncustomersandcompetitors.Becauseamarkupisadded,cost-basedpricingisoftencalledcost-pluspricing,wheretheplusreferstothemarkupcomponent.13-64FormsofCost-PlusPricingCost-pluspricingcanbedeterminedseveralways:Chooseamarkuptoearnatargetrateofreturnoninvestment,whichisthetargetannualoperatingincomedividedbyinvestedcapitalComputingthespecificamountofcapitalinvestedinaproductischallengingbecauseitrequiresdifficultandarbitraryallocationsofinvestmentsinequipmentandbuildingstoindividualproducts.13-65FormsofCost-PlusPricing,concludedBecausecomputingthespecificamountofcapitalinvestedinaproductischallenging,sometimesmanagersusealternatecostbasestosetprospectivesellingprices:VariablemanufacturingcostVariablecostManufacturingcostFullcost13-66CommonBusinessPracticeMostfirmsusefullcostfortheircost-basedpricingdecisions,because:Itallowsforfullrecoveryofallcostsoftheproduct.Itallowsforpricestability.Itisasimpleapproach.13-67Cost-pluspricingandtargetpricingThesellingpricescomputedunderCost-pluspricingareprospectiveprices.TheTarget-pricingapproachreducestheneedtogobackandforthamongprospectivecost-plusprices,customerreactionsanddesignmodifications.Target-pricingfirstdeterminesproductcharacteristicsandtargetpriceonthebasisofcustomerpreferencesandexpectedcompetitorresponsesandthencomputesatargetcost.13-68Life-CycleProduct

BudgetingandCostingManagerssometimesneedtoconsidertargetpricesandtargetcostsoveramultiple-yearproductlifecycle.Productlife-cyclespansthetimefrominitialR&Donaproducttowhencustomerserviceandsupportarenolongerofferedonthatproduct(orphaned).InLife-cyclebudgeting,managersestimatetherevenuesandbusinessfunctioncostsacrosstheentirevalue-chainfromitsinitialR&Dtoitsfinalcustomerserviceandsupport.Life-cyclecostingtracksandaccumulatesbusinessfunctioncostsacrosstheentirevaluechainfromaproduct’sinitialR&Dtoitsfinalcustomerserviceandsupport.Life-cyclebudgetingandlife-cyclecostingspanseveralyears.13-69Life-CycleBudgetingandpricingdecisionsBudgetedlife-cyclecostsprovideusefulinformationforstrategicallyevaluatingpricingdecisions.Thesetwofeaturesofcostsmakelife-cyclebudgetingparticularlyimportant.ThedevelopmentperiodforR&Danddesignislongandcostly.ManycostsarelockedinattheR&Danddesignstages,evenifR&Danddesigncostsarethemselvessmall.13-70NoncostfactorsinPricingDecisionsPricediscrimination—thepracticeofchargingdifferentcustomersdifferentpricesforthesameproductorservice.LegalimplicationsPeak-loadpricing—thepracticeofchargingahigherpriceforthesameproductorservicewhendemandapproachesthephysicallimitofthecapacitytoproducethatproductorserviceInternationalpricing-priceschargedindifferentcountriesvarymuchmorethanthecostsofdeliveringtheproducttoeachcountry.13-71AntitrustlawsandpricingdecisionsPricediscriminationisillegaliftheintentistolessenorpreventcompetition.Predatorypricingoccurswhenacompanydeliberatelypricesbelowitscostsinanefforttodrivecompetitorsoutofthemarketandrestrictsupply,thenraisepricesratherthanenlargedemand.13-72Antitrustlawsandpricingdecisions,concludedDumping—occurswhenanon-U.S.companysellsaproductintheUnitedStatesatapricebelowthemarketvalueinthecountrywhereitisproduced,andthislowerpricemateriallyinjuresorthreatenstomateriallyinjureanindustryintheUnitedStates.Collusivepricing—occurswhencompaniesinanindustryconspireintheirpricingandproductiondecisionstoachieveapriceabovethecompetitivepriceandsorestraintrade.13-73TermstolearnTERMSTOLEARNPAGENUMBERREFERENCECollusivepricingPage536CostincurrencePage525Customerlife-cyclecostsPage533Designed-incostsPage525DumpingPage536Life-cyclebudgetingPage531Life-cyclecostingPage531Locked-incostsPage525Non-value-addedcostsPage525Peak-loadpricingPage534PredatorypricingPage53513-74TermstolearnTERMSTOLEARNPAGENUMBERREFERENCEPricediscriminationPage534ProductlifecyclePage531TargetcostperunitPage523TargetoperatingincomeperunitPage523TargetpricePage522TargetrateofreturnoninvestmentPage529Value-addedcostPage525ValueengineeringPage52513-7513-76CHAPTER14CostAllocation,CustomerProfitabilityAnalysis,andSales-VarianceAnalysisChapter14learningobjectivesDiscusswhyacompany’srevenuesandcostsdifferacrosscustomersIdentifytheimportanceofcustomer-profitabilityprofilesUnderstandthecost-hierarchy-basedoperatingincomestatementUnderstandcriteriatoguidecost-allocationdecisions14-78Chapter14learningobjectives,concludedDiscussdecisionsfacedwhencollectingandallocatingindirectcoststocustomersSubdividethesales-volumevarianceintothesales-mixvarianceandthesales-quantityvarianceandthesales-quantityvarianceintothemarket-sharevarianceandthemarket-sizevariance14-79Customer-profitabilityanalysisCustomer-profitabilityanalysisisthereportingandassessmentofrevenuesearnedfromcustomersandthecostsincurredtoearnthoserevenues.Theanalysisrevealswhydifferencesexistintheoperatingincomeearnedfromdifferentcustomers.Thisinformationisusedtoensurethatcustomerswithlargecontributionstooperatingincomereceiveahighlevelofattentionfromthecompanywhilethosewithlowerorlosscontributionstooperatingincomedonotusemoreresourcesthantheyprovide.14-80Customer-revenueanalysisLet’slookfirstatcustomer-revenueanalysis,thenwe’llreviewcustomer-costa