Learn how to apply the theory of
constraints to management accounting.
The Theory of Constraints, a
management philosophy derived from
physics, assumes that constraints prevent
organizations from achieving better
performance.
The Theory of Constraints
(TOC) is based on a scientific method
that has been developed and refined for
nearly three decades by Dr. Eliyahu M.
Goldratt.
As a tool for business
management, it is now accepted as a
mainstream alternative to cost
accounting.
"TOC is radically different from
traditional accounting methods taught in
universities, the focus is on finding the
highest price that the market will bear
and maximizing throughput dollars, not
cost-plus accounting."
Accounting Today
This book:
Reveals a new management tool
for managerial accounting and
shows an alternative path for
other management practices.
Enables managers to quickly see
if their decisions increase
profitability.
Demonstrates some of cost
accounting's flaws, and shows
how these errors will lead to bad
decision making.
Compares the paradigm of
TOC-based throughput
accounting with more
conventional cost accounting
methodologies and in the process,
demonstrates a new way to solve
the complex problems of modern
management.
"Cost Accounting is productivity’s public
enemy number one."
Eliyahu M. Goldratt
