search query: @indexterm fixed costs / total: 59
reference: 8 / 59
| Author: | Banker, R. D. Hwang, I. Mishra, B. K. |
| Title: | Product Costing and Pricing under Long-Terra Capacity Commitment |
| Journal: | Journal of Management Accounting Research
2002 : VOL. 14:1, p. 79-98 |
| Index terms: | COSTS FIXED COSTS PRICING CAPACITY COSTS |
| Language: | eng |
| Abstract: | The authors develop a model to analyze optimal product- costing and pricing decisions in a dynamic information environment under long-term-capacity commitment. The arrival of new information about demand and cost parameters each period makes the problem complex. The optimal prices and capacity choices in the authors' model cannot be decoupled as in Banker and Hughes' (1994) single-period model. The optimal prices are based on product costs that are adjusted each period to reflect changes in expected variable costs as well as utilization of fixed activity resources. The charge for each fixed resource is monotonically increasing in the expected demand for that resource in each state given the optimal capacity choice. |
SCIMA