ABSTRACT
An interesting, and unusual, aspect of this article is that the editor of Nations’s Business made a specific request to Willard to write this article. The editor felt that businessmen did not really understand how to use cost information in making decisions and wanted a straight-forward discussion of the problem. Willard discusses the ramifications of making a business decision and points out the principles that should be applied in using cost data for decisions. He expands on the following principles:
Costs common to alternatives should be ignored.
Costs must be tailor made.
Only estimated future costs are pertinent.
Non-book costs, such as imputed or opportunity costs, may be relevant to the decision.
The longer the period involved, the more likely that a given cost will be affected by the decision.
