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Accounting At Your Fingertips, 2e by George Murray, CPA.

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13.5 Making Decisions

Measuring Costs and Benefits

Taking on New Business

Discontinuing a Product

How Many Must Sell?

Make or Buy?

All this financial data you’ve generated can also be useful for decision-making. Should you add a new product? Discontinue an old one? Can you afford to buy new equipment, or should you lease it? In this subchapter, we go over some simple ways to help you decide.

Measuring Costs and Benefits

Every choice you make about the course of your business is going to have a financial impact. Even something as simple as adding a new product, while offering potential revenue, also brings added expenses. To evaluate the potential costs and benefits of these different alternatives, you use what’s called incremental analysis. ...

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