Price and Product-Mix Decisions Under Different Cost Systems

1. Front Matter

   Pages I-XXV

   PDF

2. Introduction

   • Philipp Plank

   Pages 1-5

3. Simulation research framework

   • Philipp Plank

   Pages 7-39

4. Price and Product-Mix Decisions Under Different Cost Systems

   • Philipp Plank

   Pages 41-90

5. Extended Decision Model Incorporating Cost-Stickiness

   • Philipp Plank

   Pages 91-115

6. Conclusion

   • Philipp Plank

   Pages 117-118

7. Back Matter

   Pages 119-132

   PDF

Philipp Plank analyses the question, what drives the quality of cost-systems and is the quality of cost-systems directly and at best positively related to the firms’ performance. In other words, is it worth investing in complex cost allocation systems or are there environmental and/or production settings in which less enhanced systems perform adequately. Using simulations, a benchmark firm (first-best solution) perfectly allocating cost to products is compared to firms implementing heuristic cost-allocation schemes (second-best solution) to identify the profit gap resulting from decisions based on limited information. Into this discussion, the idea of cost-stickiness is integrated, thereby indicating a new planning approach.

• Activity based costing
• Activity based pricing
• Cost planning
• Simulation models
• Cost-stickiness

• Seminar für ABWL & Controlling, Universität zu Köln, Köln, Germany

  Philipp Plank

Philipp Plank received his doctoral degree from the University of Cologne under the supervision of Prof. Dr. C. Homburg. He now works as a project manager und data scientist.

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