There has been little recent empirical research which has examined the application of costs in make-or-buy decisions. This paper presents the results of a questionnaire survey with 256 British management accountants and interviews with 55 of them that gather evidence about the application of costs in make-or-buy decisions. The results of the questionnaire show that, in general, direct, manufacturing or total costs or some combination thereof are used in make-or-buy decisions. The interviews showed that in some cases that costs may be used inappropriately when the costs include allocated and assigned overheads and this might lead to sub-optimal decisions.
|Number of pages||7|
|Journal||International Journal of Management|
|Publication status||Published - Dec 2006|
Brierley, J. A., Cowton, C., & Drury, C. (2006). The Application of Costs in Make-or-Buy Decisions: An Analysis. International Journal of Management, 23(4), 794-800. https://search.proquest.com/docview/233229217/fulltext/BDB1333A0DCC4F1EPQ/1?accountid=11526