The concept of incremental analysis also termed as marginal analysis is used to analyze financial information for purposes of decision making. It identifies the appropriate revenues and costs of each alternative as well as the anticipated effect of the alternative on future income ( Weygandt, Kimmel & Kieso, 2015) . The concept of incremental analysis is applicable in various ways including allocation of scarce resources, elimination of a segment, the product sells and further processing, manufacturing or buying products and parts and accepting additional business. Incremental analysis plays a role in the decision-making process of the mentioned areas of business. As a problem-solving tool for decision-making purposes, the incremental analysis focuses on three important concepts that require a thorough understanding of efficient analysis. The concepts are relevant cost, sunk cost and the opportunity cost ( Weygandt, Kimmel & Kieso, 2015) .
When somebody says, you get what you measured it implies that what we will put into something is what we will get in return, which also means that what one measures has a direct effect on the performance. In accounting, it means that regular and continuous reporting and measurement keep the business focused since the information from reporting can help in decision making hence improving overall organization results. When a business shoots for already set objectives, paying closer attention to the set goals will help achieve them.
Delegate your assignment to our experts and they will do the rest.
Information technology has an outstanding impact on the accounting practices through enabling organizations to develop and utilize computerized systems for storage and recording of financial transactions. Information technology can help operational efficiency, achieving regulatory compliance as well as supporting financial reporting and management and attaining revenue increments. Information technology has also reduced the lead time needed for preparation and presentation of financial information by accountants. There is so much accuracy in the financial information stored in the computerized systems. Information technology has led to the translation of manual spreadsheets, paper ledgers and manually written financial statements into computer systems. The computer systems help in quick presentations of individual financial transactions into appropriate financial reports.
Reference
Weygandt, J. J., Kimmel, P. D., & Kieso, D. E. (2015). Managerial accounting . Wiley.
