Application of Marginal Costing Techniques in Management Decision Making
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Abstract on Application of Marginal Costing Techniques in Management Decision Making
This research work was undertaken to assess the concept and application of marginal costing techniques in management decision making reference to Nestle Food Plc. This work was intended to achieve the following objectives: Showing the importance of marginal costing as a tool for planning and short term decision making and to ascertaining the format to be used on presenting marginal costing information by management accountants to the management. Relevant data were collected from both primary and secondary sources. Questionnaire was the main primary data collected instrument employed while data from various relevant publications constituted the sources of secondary data. Upon the analysis of data the (SPSS) along with percentage mean item was used to analyze the questionnaires while ANOVA was used to test the hypothesis. The study established that the marginal costing technique is the key aspects of the Accountant’s job. The management Accountant ascertain whether the technique contributes to high quality decision making which will help him in reporting on magical casting techniques to Nigerian Nestle Food Plc, and the extent to which reliance can be placed on the technique. The overall objective of any organization is to maximize profit and hence increase in wealth of its shareholders. Based on the finding and conclusion arrived, it recommend that practicing management accountant should identify relevant cost and provide information to management on the effect of costs and revenues of charges in volume of output in the short run and Fixed cost should not be absorbed into product cost along with variable cost rather they should be treat as period cost which are simply charged to profit with fixed selling and administrative cost during that period by the management.
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