Term
| Four Step Framework for decision making |
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Definition
1. Specify the decision problem, including the decision makers goal.
2. Identify options.
3. Measure cost and benefits to determine value of each option.
4. Make the decision, choosing the option with highest value |
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Definition
| What we strive to achieve |
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Term
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| choosing one option from a set of options to achieve a goal |
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Definition
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Term
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| the value to the decision maker of the next best option, businesses typically measure the opportunity cost in terms of money, or profit. |
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Term
| Differences between individual goals and organizations |
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Definition
1. Organizational goals have focused goals unlike individuals who have several factors.
2. Organizations are composed of individuals with their own goals that don't always coincide with the organizations goals. |
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Term
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| a group of individuals engaged in a collectively beneficial mission. |
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Term
| Maximize Shareholder value |
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Definition
| maximize the returns to shareholders investing in a company. Goal for a publicly held company |
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Term
| What can business owners do to align individual goals and organizational ones? |
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Definition
1. Policies and procedures.
2. Monitoring to enforce policies and procedures.
3. Incentives schemes and performance evaluation. |
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Term
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Definition
| Relate to choices about acquiring and using resources to deliver products and services to customers. Planning includes deciding which products and services to offer, their prices, and the resources needed, such as materials, labor, and equipment. |
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Definition
| Relate to choices about acquiring and using resources to deliver products and services to customers. Planning includes deciding which products and services to offer, their prices, and the resources needed, such as materials, labor, and equipment. |
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Definition
| Relate to motivating, monitoring, and evaluating performance. Involve examining past performances, with the purpose of improving subsequent plans. |
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Definition
Planning
Implementing
Evaluating
Revising |
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| aims to satisfy the information needs of decision makers outside the firm, such as shareholders, creditors, and taxing authorities. Used for investors to determine if they should buy or sell stock. IRS uses to figure out taxes. |
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Term
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Definition
| aims to satisfy the information needs of decision makers inside the firm. Useful for both planning and control decisions. |
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Term
| How to define expected behavior in the work place |
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Definition
| Laws, rules, and regulations |
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Term
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| Chief Financial Officer. Reports to CEO and is responsible for all accounting and financial functions. |
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| Chief Internal Auditor. Manages the internal audit function. |
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Definition
| Manages the day to day accounting for the firm and oversees corporate accounting policies. |
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Term
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Definition
| Manages the firm's cash flow and serves as the contact point for banks, bondholders, and other creditors of the firm. |
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