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Literature Review: Throughput Accounting and Theory of Constraints - Book Report/Review Example

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Literature Review: Throughput Accounting and Theory of Constraints

(Atrill, et al., 1994 pp. 6-7) (Scarlett, 2006 p. 351) According to Mr. David James Anderson, Throughput Accounting is a Management Accountancy principle, of which the prime motive is to help in the decision making process for managers in terms of marketing decisions, promotional decisions, hiring decisions, etc. (Anderson, 2004 pp. 15-17) Although author Mr. David J. Anderson primarily focuses on the use of Throughput accounting in Software engineering industry as the author himself is a software engineer. But based on the titles of some of his books, his knowledge about Management accounts is eminently displayed. The author focuses on how the Throughput Accountancy principle of Management accounts can be incorporated in a forecasting software so as to enable automated forecasting, and to facilitate the managers to make better decisions and business plans.
The author has presented a superb figure in his book to further clear the throughput accountancy fundamental:

Figure 1: (Anderson, 2004 pp. 15-17)

Many other prominent authors such as Steven M. Bragg, Mike Bendrey, Michael Bendrey, Roger Hussey, Colston West, and Terence Lucey have also discussed this same fundamental (Bragg, 2007) (Bendrey, et al., 2003) (Lucey, 2003) (Garrison, et al., 1997), which we have elaborated in detail in the next section of our Literature review:


Throughput Accounting And Theory of Constraints
Within this segment of our Literature review the author has discussed some very prominent views and arguments regarding the concept of Throughput accountancy, its use, principle, and criticism by various dominant authors in the field.
Throughput Accounting in a Historic Prospective
Authors Victoria J. Mabin and Steven J. Balderstone shed light on the formation of the concept of Th ...Show more

Summary

Management Accountancy is a belatedly revealed Accountancy theory that unlike other accountancy theories does not primarily deal with costing, taxation, corporate fundamentals / technicalities, etc…
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