1-1.1. Overview of Business Decisions

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En provenance du cours de University of Illinois at Urbana-Champaign

Accounting for Business Decision Making: Measurement and Operational Decisions

54 notes

University of Illinois at Urbana-Champaign

Accounting for Business Decision Making: Measurement and Operational Decisions

54 notes

Cours 3 sur 5 dans Specialization Fundamentals of Accounting

Accounting information is the lifeblood of the organization as it facilitates and influences operational and strategic decisions intended to achieve organizational goals. Organizations benefit from three decision-oriented roles of accounting: measurement, control, and communication. This course provides an introduction to accounting’s measurement role inside of an organization and how accountants communicate information that helps managers and employees make operational decisions. In particular, you will learn how cost information is created and organized to help managers and employees conduct profitability analyses, develop and choose products, make pricing decisions, and make common business decisions. Upon successful completion of this course, you will be able to: • Identify the nature, purpose, and importance of different types of decision-useful accounting information. • Create, organize, and communicate cost information to best suit common operational decisions. • Use accounting information to manage products, control costs, and leverage other drivers of operational success. If you enjoy this business course and are interested in an MBA, consider applying to the iMBA, a flexible, fully-accredited online MBA at an incredibly competitive price offered by the University of Illinois. For more information, please see the Resource page in this course and onlinemba.illinois.edu.

À partir de la leçon

Module 1: Introduction to Business Decision Making

Any organization – no matter how large or small – is extremely complex. It is made up of processes, systems, products, and – perhaps most important – people. Why are people most important? Because they are the ones making decisions, guiding the firm towards success. Wondering what these decisions are and how they’re made? Join in on Module 1!

1-1.1. Overview of Business Decisions3:16

1-1.2. Application and Extension3:06

1-1.3. What We’ve Learned0:46

Rencontrer les enseignants

Gary Hecht, Ph.D.
Associate Professor of Accountancy
Department of Accountancy, College of Business

[SOUND]

Welcome to Module 1.

In this first lesson, we'll pursue the following objectives.

By the end of the module and this first lesson, you should be able to

recognize the prevalence and variety of decisions in organizations, and

understand the reliance of organizations on information.

Now let's talk about what we'd see if we were to look inside

of different organizations.

No matter how large or small, no matter if it's for profit or not for profit,

and no matter if it's a manufacturer, retailer, or service-based organization,

what we would see in every organization is decisions, decisions, and decisions.

Now, what types of decisions would we see?

All kinds.

From the everyday mundane decisions like an employee deciding, should I work

an hour of overtime to the decisions that are long-term and strategic.

Guiding the firm for the next five or ten years.

Now, who are we talking about when we think about decision makers?

Well, we have the owners of the organization.

But then also, all of the managers and

employees who are making decisions on behalf of the owner.

And when are decisions being made?

Well, in many organizations, there is recurring decisions.

Stuff that goes on, on a weekly basis or monthly basis.

But then, of course,

there's the one off decisions that pop up whenever they need to be made.

So, when are we talking about the decisions?

Whenever necessary.

Now, all decisions are different.

But if there's one thing that all decisions have in common,

it's the need for information.

And given the variety of activities that go on inside the firm, and

the variety of decisions,

you can think about the information as being the lifeblood of the organization.

The stuff that keeps the organization going and the owners and managers and

employees all figuring out how to achieve organizational objectives.

Now what types of information can we think about?

Well, there is financial information and when we think about the common accounting

courses, that's the first thing that comes to mind.

You can think about financial statements, you can think about debits and

credits, account balances.

All the dollars and cents that represent the costs,

revenues, assets, liabilities and equity inside of an organization.

But accounting doesn't stop just at the financial information,

it also includes the non financial information.

A lot of that is quantitative itself.

You can think about productivity measures like how much rework needs to be done or

what the quality of our products are on some scale.

But non-financial information includes qualitative information as well.

Things like customer satisfaction ratings about the product or

the good that's purchased by those customers, and after sale service.

Those ratings are qualitative in the sense that people are very satisfied or

somewhat dissatisfied with the organization or the product.

So that's just the beginning.

But before we move on,

why don't we have a quick checkpoint to make sure we're all on the same page?

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