Business Planning and Entrepreneurship An Accounting Approach

Abstract

This text is a nuts-and-bolts guide to business planning. It is designed to function as a handbook for entrepreneurs who wish to apply techniques of management accounting to their planning activities. Because management accounting is a practical discipline, it provides an ideal framework for the construction of business plans. This book leads the reader through six major sections that represent the modular components of any organizational plan; the reader is encouraged to follow along and construct a plan for his or her own organization as he or she progresses through each chapter. The six sections address the major topics of the plan, namely: the business model, volume estimation, cost estimation, revenue estimation, investment value, and risk management. Each section is subdivided into three distinct chapters that address the concrete concepts, tools, and techniques of business planning. The chapters and sections include cross-referenced information in order to help the reader grasp various fundamental principles that pervade all planning documents. For instance, the topic of cost behavior ? rst appears during the discussion of direct and indirect costs in the cost estimation section of the text and is later revisited during the discussion of price targeting in the revenue estimation section. Such linkages help the reader develop plans that are heavily integrated in nature and ? rmly grounded in content. Furthermore, this text also integrates management accounting concepts with relevant themes that are shared with other ? elds of business. Concepts of supply and demand, for instance, are shared by management economists; they are addressed in the volume estimation section of this text. And techniques of competitive pricing strategy are shared by marketing professionals; they are likewise addressed in the revenue estimation section. Another distinctive element of this text is its coverage of the discipline of risk management, which appears explicitly as the ? nal major section of the book and implicitly as well within earlier sections such as cost variance analysis. Entrepreneurs that are faced with highly uncertain business conditions can bene? t by incorporating concepts and techniques of risk management in their plans. Some readers may wish to focus on the illustrative examples in each chapter that follow the activities of a single entrepreneur as he applies principles of management accounting to his planning activities throughout his large organization. Other readers may choose to refer to the integrated example in the appendix that summarizes the planning activities of a different entrepreneur who is managing a much smaller ? rm. All readers, though, can bene? t by learning how to use techniques of management accounting to support and strengthen any business plan. This book provides a useful template for such activities. Keywords Activity-based costing, business planning, cash ? ow analysis, competitive pricing, cost behavior, direct costs, ? nancial ratio analysis, ? exible budgets, game theory, indirect costs, internal controls, management accounting, outcomes management, outcomes measurement, price discounting, price targeting, process chain, process ? ow analysis, quality management, risk assessment, risk management, scenario event identi? cation, supply and demand, variance analysi

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oai:openlibrary.telkomuniversity.ac.id:20.21.016Last time updated on 4/16/2020

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