Optimal Smoothing of Profit Via Overhead Allocation.
Income smoothing, as defined in Statistical Activity Cost Theory (SACT), is the rational statistical adjustment of periodic accounting earnings to reduce their time volatility around average long-term profit per period. This article demonstrates how overhead cost allocations can be applied to smooth...
| Publicado en: | Abacus Vol. 43; no. 2; pp. 136 - 156 |
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| Formato: | Artículo |
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Wiley-Blackwell
Jun2007
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| Acceso en línea: | Ver este registro en EBSCOhost |
| fields | @attributes: recordID: 1 pdfLink: plink: https://search.ebscohost.com/login.aspx?direct=true&db=hlh&AN=25129966&site=ehost-live header: @attributes: shortDbName: hlh uiTerm: 25129966 longDbName: Humanities International Complete uiTag: AN controlInfo: bkinfo: jinfo: jid: 00013072 AUB jtl: Abacus issn: 00013072 maglogo: Y pubinfo: dt: Jun2007 vid: 43 iid: 2 pid: 480 pub: Wiley-Blackwell artinfo: ui: 25129966 10.1111/j.1467-6281.2007.00223.x ppf: 136 ppct: 20 formats: fmt: @attributes: type: P size: 1.8MB tig: atl: Optimal Smoothing of Profit Via Overhead Allocation. aug: au: Shuo Su, Steve Yu affil: The George Institute for International Health su: Cost allocation Cost accounting Depreciation Profit Corporate profits Accounting methods sug: subj: Cost allocation Cost accounting Depreciation Profit Corporate profits Accounting methods ab: Income smoothing, as defined in Statistical Activity Cost Theory (SACT), is the rational statistical adjustment of periodic accounting earnings to reduce their time volatility around average long-term profit per period. This article demonstrates how overhead cost allocations can be applied to smooth accounting earnings optimally in accordance with this definition. Such an approach parallels earlier work, such as that by Lane and Willett (1997 , 1999 ), in which a depreciation formula was derived and applied for this purpose. In particular, it is shown that, to realize an income smoothing effect in profit making firms, the usual optimal strategy is to over-allocate costs, giving support to the accounting principle of conservatism. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: Y custom: Copyright of Abacus is the property of Wiley-Blackwell and its content may not be copied or emailed to multiple sites without the copyright holder's express written permission. Additionally, content may not be used with any artificial intelligence tools or machine learning technologies. However, users may print, download, or email articles for individual use. item: Abacus holder: Wiley-Blackwell dt: @attributes: year: 2007 holdings: @attributes: islocal: N |
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