This paper presents a formal derivation of general expressions for Ke and WACC in perpetuities with constant growth, which do not make any assumption on what the proper discount rate is to be applied to the firm's tax shield, and are complemented with numerical examples of its application....

In this paper we propose an analytical solution to the circularity problem between value and cost of capital. Our solution is derived starting from a central principle of finance that relates value today to value, cash flow, and the discount rate for next period. We derive a general formulation...

We explore the role of stock liquidity in influencing the composition of CEO annual pay and the sensitivity of managerial wealth to stock prices. We find that as stock liquidity goes up, the proportion of equity-based compensation in total compensation increases while the proportion of...

Recent research on cost behavior has revealed that costs do not change proportionately with changes in sales, showing that costs increase in response to increases in sales, but do not decline proportionately with reductions in sales. This asymmetric cost behavior is termed as “sticky costs.”...

We examine how subjective performance evaluations are influenced by the level and controllability of an accompanying measure of a separate performance dimension. In our experiment, supervisor participants evaluate the office administration performance of a hypothetical subordinate. We find that...

Activity-Based Costing insists on the necessary homogeneity of cost pools to provide more reliable cost data than traditional systems. This condition forces cost system designers to distinguish between a large number of activities and may hence induce overwhelming complexity. ABC supporters...

Behavioral aspects and attitudes toward the balanced scorecard (BSC) could be a determinant factor in the success of BSC implementation. In the study we examine the match between factors affecting employee buying into the BSC and corporate strategy and whether a fit between them is necessary to...

Many organizations applied the Balanced Scorecard (BSC) to their shared service units (SSUs) in order to increase the value of SSUs; however, few studies show the implementation and effects of BSC on the SSUs in real cases. This study examines two issues: First, we illustrate the case related to...

Managers can use private information to strategically misrepresent costs and consume additional resources at the expense of the firm. However, past research has demonstrated that managers do not always fully misrepresent, thus failing to display economically rational decision making. This paper...

Sometimes it is very difficult to find out accumulate information about techniques and tools of management accounting. It create hazardous for the searcher to find out the techniques and tools from here and there. Again sometimes some want to know the basics of various techniques and tools used...