Compare and Contrast the Theory of Constraints and Activity Based

question 99

Essay

Compare and contrast the theory of constraints and activity based costing. Which is more useful in short-run and long-run management of costs?

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Definitions:

PIKs

Short for "Payment in Kind," a type of financing or loan where the borrower can pay interest or dividends with additional securities instead of cash.

Mortgage Bond

A type of bond secured by a mortgage on one or more assets, offering the bondholder a claim against the assets in case of default.

Securities

Financial instruments that represent an ownership position in a corporation (stocks), a creditor relationship with a governmental body or a corporation (bonds), or rights to ownership as represented by an option.

Equipment

Tangible property other than land or buildings that is used in the operations of a business, such as machinery, tools, or vehicles.