DETAIL
ECONOMIST VIEW
ACCOUNTANT VIEW
The Revenue Line In the Economist's
The Revenue Line in the Account's
view is not a straight line. The Revenue
view,is a straight line.The Revenue is
Line is a curve,as it is believed by
line
economis that
reasons(Burns et Al 2013):-
S/N
01.
when the marginal
is
straight
due
to
two
considers
a
revenue (selling price) increases, the
Revenue Line
total revenue will continue to increase,
but the increase would be proportionally
less and less.(Burns et Al 2013)
i)The
accountant
shortterm relevant range of volumes
over
which
fixed
cost
remain
unchanged(Burns et Al 2013)
ii)Over the short-term, the per unit
selling price and the per unit variable
costs
may
considered
to
be
In
the
constant.(Burns et Al 2013)
02.
The Total Cost Line In the Economist's
The
view is not a straight line,The Total Cost
Economist's view is a straight line.
line is a Curve.The total cost comprises
This
both fixed cost and Variable Cost.The
reasons(Burns et Al 2013):-
total cost line depicts costs as rising fast
Total Cost line
at first as the output levels are lower
therefore as the total costs increase, the
increase is proportionately less and
Having a Curve Shape (Burns et Al 2013)
i)The
Total
is
due
Cost
to
accountant
Line
the
following
considers
a
shortterm relevant range of volumes
over
which
fixed
costs
remain
unchanged(Burns et Al 2013)
ii)Over the short-term, the per unit
selling price and the per unit variable
costs
may
considered
constant.(Burns et Al 2013)
1
to
be
03.
Range
The Economist's view has a wider range
The Account's view has a smaller of
of production which will is important for
range
efficiency. This is due to the variety in
comparatively less efficient than in
production hence being critical as even
Economist's view that has a wider
profit may increase. (NBAA 2019)
range of production.(NBAA 2019)
The Economist's view has a break even
The Account's view has a break even
chart,that shows the graphs of total cost
chart,that shows the graphs of total
and total revenue graphs.The chart has
cost and total revenue graphs.The
two (2) break even points,at which total
chart has one (1) break even
cost equals total revenue (NBAA 2019)
points,at which total cost equals
of
production.This
is
of
Production
04.
Break
Even
total revenue (NBAA 2019)
Points
05.
Objective
The Economist's view has one particular
The Account's view has a particular
objective. This is to provide predictions
objective too.The objective is to
of
have
market variables.Such variables
practical
assistance
related to market include price and
decision-making
volumes. Hence this view can predict
organisation.This will be beneficial as
their values (NBAA 2019)
it
provides
within
great
help
organization.(NBAA 2019)
2
a
for
given
for
an
REFERENCES
Burns,J. Quinn,N.Warren,L.Oliveira,J.(2013). Management Accounting.Berkfire:Mc-Graw
Hill
NBAA (2019).B5 Performance Management:Study Text.Dar es Salaam:National
Board of Accountants and Auditors of Tanzania.
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