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Capacity Management: How to Avoid Suboptimal Decisions
Author(s) -
Kren Leslie,
Kimmel Paul
Publication year - 2001
Publication title -
journal of corporate accounting and finance
Language(s) - English
Resource type - Journals
eISSN - 1097-0053
pISSN - 1044-8136
DOI - 10.1002/jcaf.1109
Subject(s) - unit (ring theory) , operations research , fixed cost , operations management , focus (optics) , business , economics , computer science , microeconomics , mathematics , physics , mathematics education , optics
Managers often calculate fixed costs per unit based on the expected activity for the period. But allocatingfixed costs based on expected activity can result in suboptimal decisions. What is the answer? Focus oncapacity instead. © 2001 John Wiley & Sons, Inc.