Concept Of Cost Research Articles

TRANSACTION COSTS IN THE ACTIVITIES OF INSURANCE INSTITUTIONS

Introduction. The concept of transaction costs plays an important role in understanding the relationship between insurer and the insured, the principle of mutual good faith in the relations of these participants, the nature of the insurance company, managing insurance relations to increase the size of the insurance portfolio and increase solvency, increase insurer value. The presence of transaction costs in practice leads to a decrease in the efficiency of insurance institutions, as well as to a decrease in the financial results of insurance. The purpose of the study is the theoretical substantiate the nature of transaction costs that arise in the activities of insurance institutions, and development of practical recommendations for their reduction. The methodological basis of the study is a systematic approach, methods of analysis and synthesis, theoretical and abstract-logical generalizations and hypotheses, methods of comparison and grouping, the method of classification. Results. The institutional features inherent in the formation and development of insurance institutions are highlighted. It is determined that the main reason for transaction costs in insurance relations is the existence of asymmetry of information about the object of insurance, the probability of the insured event, the financial stability of the insurer, etc. The main types of transaction costs of insurance institutions are described: information retrieval, negotiation, measurement, costs of specification and protection of property rights, costs of opportunistic behavior. Based on the study, potential ways to minimize transaction costs of insurance institutions are revealed: state policy, vertical integration, reduction of bureaucratization, development of information and communication technologies, transactional analysis, process management model. The practical significance of the study lies in the justification of the need to purposefully influence the amount of transaction costs of insurance institutions in order to minimize them.

Primena principa konzervativizma nasuprot primeni koncepta fer vrednosti - primer srpskog tržišta kapitala

The characteristic of striving towards the application of the new valuation concept, as opposed to the application of traditional accounting principles, modern financial reporting prompted the authors of this paper to address the importance of the application of traditional accounting principles, especially the principle of prudence (conservatism), and the concept of fair value for the accounting information relevance. The most important business decisions in the entity are made on the basis of information produced by the accounting information system, based on which we see how important it is for this information to be up to date. The relevance of the information of the accounting system of first-class importance is the basis of evaluation, which is the subject of research in this paper. More precisely, the paper examines the methods of measurement after initial recognition of fixed assets on the example of a group of business entities operating on the Serbian capital market. The results of empirical research are of a twofold nature. Namely, for measurement after initial recognition of intangible assets, plant and equipment, as well as other property, plant and equipment, the concept of historical cost and the traditional accounting principles immanent to it are primarily used. For measurement after initial recognition of buildings, land, investment property and biological assets, the concept of fair value is more often used. In other words, using a practical example, we have shown that the combined basis of financial reporting is the dominant feature of modern financial reporting of entities operating in the Serbian capital market.

Deep learning and forecasting in practice: an alternative costs case

The usage of machine learning methods in the financial sector, regarding repayment prediction or forecasting, is quite a new topic, constantly gaining in importance. The concept of the alternative costs in the literature covering machine learning and deep learning occurs most often in connection with the non-financial areas as costs of lost benefits. This empirical paper presents research dedicated to deep learning used in forecasting the alternative costs of leasing represented by the variable KUK_PRC. The study is based on the experimental approach and uses real organization data to solve the forecasting problems in the financial area with AI solutions. This research contributes to the science by identifying and exploration of the research gap in the field of applied economics and finances. The main finding of this paper is the proposed forecasting ACSeq-DNN model that forecasts opportunity costs with smaller deviations from actual values than the forecasting achieved by state-of-the-art models.

Naknadno merenje stalne imovine - uticaj izbora koncepta fer vrednosti na ukupan sveobuhvatni rezultat listiranih kompanija u Republici Srbiji

In response to investor demands, with the introduction of the fair value (FV) concept, other comprehensive income (OCI) has become a significant indicator of changes in the current values of certain financial statement items in successive periods. Although it deviates from the traditional concept of historical cost (HC) and its prudence principle, on which reliability rests, the use of fair value contributes to the relevance of the presented information. The total comprehensive income (TCI), as a summary of realized and unrealized gains and losses recognized in the income statement, i.e. OCI, represents a valuable base of relevant information for investors and other users of financial statements. The paper focuses on a sample of listed entities on the Regulated Capital Market of Serbia for the period 2016-2020 and finds that the FV concept is predominantly used for the subsequent measurement of property, plant and equipment (PP&E). In addition, we analyze the impact of changes in the fair value of certain non-current assets' items (i.e.: PP&E, intangible assets and long-term investments) on TCI. Our research shows that some OCI items have a divergent impact on TCI, and, thus, different information power, which can increase uncertainty, i.e. make it harder for analysts to predict net income.

Switching costs of citizens’ behavior change as a tool of post-pandemic urban transport policy: the case of St. Petersburg

The goal of this study was to discuss possibilities to use Covid-19 as a context situation to change citizens’ transportation behavior. The concept of switching costs is applied to construct algorithm for search of suitable post-pandemic urban transportation policy tools based on analysis of citizens’ transportation behavior and transportation mode choice factors before and during Covid-19 pandemic. To accomplish the goal this work provides analysis of St.Petersburg citizens’ survey results. The study examines what changes in the transport preferences of citizens have occurred. The reasons that contributed to changes in transportation preferences were analyzed. One of the conclusion states that context (objective) changes influence transportation behavior of just some groups of citizens. For others the greater role in post-pandemic transportation behavior is played by subjective factors of transportation mode choice. So, we conclude that those subjective factors should be used to construct switching costs to preserve positive transportation behavior, and switching benefits to avoid negative transportation behavior, which occurred during Covid-19 pandemic.

Эффективность финансового сектора: существующие концепции и проблема оценки

This article presents classification of existing concepts of the efficiency of the financial sector. Proposed the hypothesis that assessments of the microeconomic and informational efficiency of the financial sector are fundamentally based on the concept of transaction costs. Suggested a number of indicators for assessing the macroeconomic efficiency of the financial market and their approbation on the Russian data. We identified four areas for assessing the effectiveness of the financial sector, differing in the level of consideration, recognition of the principle of rationality, accounting for transaction costs: assessing the macro-efficiency of the financial sector; information-efficient market hypothesis; the concept of adaptive markets. The assumption is formulated that the concepts studying the efficiency of financial systems at the micro level, as well as the efficient market hypothesis, are based on the principle of minimizing transaction costs. While there is a significant theoretical backlog on the issue of macroeconomic efficiency of the financial sector, there is a shortage of quantitative estimates, so we tried to offer a number of such indicators, focusing on the functions of financial markets in a developing economy. The article constructs the estimates of the macroeconomic efficiency of the Russian financial market from two sides of the process of transforming savings into investments (attracting investments by enterprises and placing savings by households).

Exergoeconomic analysis and parametric investigation of a gas turbine power plant

Thermoeconomic models, combining the concept of cost in economics and the concept of exergy in thermodynamics, provide the ability to optimize complex power generation systems to achieve the best balance between thermodynamic efficiency and economic cost. In this paper, a parametric analysis was carried out based on the method of calculating the unit exergy cost, as well as exergo-economic studies and cost sensitivity studies on the exergy of the cycle of a gas turbine power plant. The mathematical models of mass, energy, effort, and economy were created and presented. Thermodynamic properties and research analysis are performed using the MINI- REFerence fluid PROPerties (MINI-REFPROP) and matrix laboratory (MATLAB) SIMULINK software packages. The analysis leads to valuable benchmarks of the economic situation. The exergo-economic coefficient, the total cost of exergy loss, exergy destruction for the combustion chamber, and labor productivity are determined. When conducting parametric studies, the influence of the temperature at the inlet to the gas turbine, the temperature at the inlet to the air compressor, and the degree of pressure increase in the compressor were taken into account. The combustion chamber at the plant was found to have the highest energy destruction rate of 80%, indicating that boilers need to be given more attention in terms of design, selection, operation, and maintenance. However, in percentage terms, the combustion chamber has a high improvement potential of 94%. Sensitivity and parametric analysis show that while the exergy factor, the total cost of exergy loss, exergy destruction for the combustion chamber, and power output fall with increasing air compressor inlet temperature, it can be increased with increasing compressor pressure ratio. The total energy loss cost, combustor energy loss, and power output decrease as the gas turbine inlet temperature rises, while the cycle network and overall exergy destruction rate increase. The rates of the exergy destruction of the Venture Capital (VC), the combustion chamber of the combustion chamber, and the total exergy destruction are 25.2, 122.3, and 153.2 MW, respectively, for the proposed conditions. In addition, the results showed that it was $2,272 per hour, while the cost of work performed in energy terms is $1,769 per hour with a fuel cost of $0.003 per MJ. A valuable achievement is the availability of defined values and clear parametric influences, which can be of great help to engineers and site operators in the efficient execution of unique tasks, playing with the conflicts of energy use, exergy, and cost.

Economic Analysis of Rice Crop under Three Categories of Farm Holders at the Time of Covid-19 Pandemic

he study was relatively undertaken at the time of Covid-19 pandemic in Bilaspur District of Chhattisgarh state, India, to know the overall economic structure of gross expenditure, profitability structure, production cost concept, net returnes, benefitcost ratio (BCR) of rice crop under three categories of farm holders. Purposive as well as multistate random sampling methods were adopted for the research study. A total of 30 farmers were selected from the categorized three group’s viz. small, medium, and large farmers. With the help of a prepared pre-tested interview schedule, a survey method was applied for primary data collection. The actual gross and net return of rice grower was needed to know at the situation of the covid-19 pandemic. So that could reach on real cost and net returns structure and explain it under three different farms size holders, therefore worked on this vital subject of the overall economic profile. This research revealed that Cost C2, C3, production cost (Rs. /quintal) at C3, net profit at C3, and (BCR) benefit-cost ratio at C3 in one acre of small rice grower was Rs. 27662, Rs. 30,428.2, Rs. 1521.41, Rs. 19571 and 1:1.64 respectively. Thus, cost C2, C3, cost of production (Rs. /quintal) at C3, net profit at C3, and the benefit-cost ratio at C3 in one acre of medium rice grower was Rs. 31576.08, Rs. 34,733.68, Rs. 1447.23, Rs. 25266.32 and 1:1.72 respectively. Similarly, cost C2, C3, cost of production (Rs. /quintal) at C3, net profit at C3, and the benefitcost ratio at C3 in one acre of large rice grower was Rs. 32908.08, Rs. 36,198.8, Rs. 1447.95, Rs. 26301.12 and 1:1.72 respectively. After jointly calculating the categories of data based on farms size, it revealed that the average total expenditure, Cost 2, C3, production cost (Rs./q) at C3, net profit at C3, and BCR at C3 were Rs. 30715.38, Rs. 30715.39, Rs. 33786.92, Rs. 1472.19, Rs. 23712.81, and 1:1.69 respectively. According to findings medium and large farmers do higher production of rice crop in one acre comparison of the small farmer. Labor cost is more in the rice farming in the study area, need to them the economical planning that could help ineffective use of input and get maximum profit through better farming.

NILAI EKONOMI KEGUNAAN WISATA ALAM SITUGUNUNG TAMAN NASIONAL GUNUNG GEDE PANGRANGO

The Situgunung area has direct usability value as recreation place and natural tourism. This study aims to determine the perception of visitors and the economic value usability on the natural tourism of Situgunung. This research method uses descriptive methods as well as traveling expenses or the Travel Cost Method (TCM). Testing the perception of visitors using validity and reliability tests were analyzed descriptively using a Likert scale and the economic value use was analyzed using the concept of travel cost (TCM). This result of the study indicates the index of visitors’ perceptions of Situgunung Nature Tourism from the beauty is 89,25% very beautiful, the security aspect is 83,5 % very safe, the hygiene aspect is 77,5% very clean, the accessibility aspect is 77,75% very easy, the facility aspect is 74,25% complete. And the economic value of the use of Situgunung Nature Tourism is Rp.49.197.122.816/year, with the average traveling expenses calculated based on the zone or distance from the area from which the visitor came to the tourist location. With the high perception of visitors and the value of economic use of Situgunung Nature Tourism objects, a more professional management is needed without reducing the concept of natural sustainability.

Manajemen Operasional Pelabuhan Penyeberangan Batulicin – Tanjung Serdang Provinsi Kalimantan Selatan

The Batulicin ferry port in Tanah Bumbu and the Tanjung Serdang crossing in Kotabaru, Pulau Laut district, has a very important role for transportation in facilitating the flow of goods and people as a series of the South Kalimantan Axis Cross Road that connects the city of Banjarmasin and all cities in South Kalimantan province and the city. -cities on the island of Kalimantan to Kotabaru, Tanah Laut district. With the economic development around coal mining, plantations and tourism in South Kalimantan, it is estimated that the need for transportation services from year to year always increases. To anticipate these conditions, the land transportation system and crossing required optimal performance standards. This research was conducted at the Batulicin - Tanjung Serdang crossing by taking case studies at the Batulicin and Tanjung Serdang ferry ports. The purpose of this study is to find a solution to the problem of optimizing the Batulicin port operating system whether additional ships are needed due to the long queue of passenger cars and goods that will cross from Batulicin to Kotabaru or vice versa. The data collected includes the performance of the crossing system, data retrieval is carried out on December 20 to December 24, 2021. Data analysis is based on the concept of combined costs, between vehicle waiting time costs and ship operating costs, with the number of ships. From the results of the discussion, it can be concluded that operational management in the form of an optimal performance system requires 4 ships with a minimum combined cost reference.

Is there a general equivalent of transaction costs?

The article raises the question of the existence of a general equivalent of transaction costs other than money. A distinction was made between the concepts of transaction costs and transaction actions. The definition of transaction costs is given as a cost (in the sense of costs of value and time) trace of transactional actions. The concept of a continuum of transactional actions was introduced. the composition of the continuum of transactional actions is outlined and the main reasons for its increase in the modern economy are identified. among these reasons are specific to the economy, which is transitioning from a Soviet-type command-administrative system to a market one. The mechanism of displacement of market transactions by the firm has been specified. Transactional substitution is a process (processes) of the firm’s performance of a certain set of transactional actions that accompany transformational processes from their beginning to their end. Transaction substitution is related to the transaction capacity of the institute. Correspondence between subsets of the continuum of transactional actions and transformational (production) processes is established. The concept of an agerative system is introduced as one of the two large systems that support symmetry in the economy, and which exists in parallel with the market or commodity-money system. Agerative system is built on the basis of management actions and is a complex of management, transactional actions of all types and types. A table was created in which the main correspondences between transformational and transactional types of processes and the economic phenomena generated by them are placed. Transformational and transactional processes generate different types of economic phenomena. If in transformational processes goods are created, more precisely, natural-material bodies of goods as carriers of value, then institutions are created in transactional processes. If as a result of the development of transformational (production) processes there is an accumulation of capital (which, in fact, is the goal of capitalist production), then as a result of the development of transactional processes there is an accumulation of managerial power. The goal of bureaucracy is to increase and concentrate managerial power. Keywords continuum of transactional actions, transactional actions, transactional costs, transformational processes, the transaction envelope of the production process, the total equivalent of transaction costs, physical goods, carriers of value, agerative system, levels of hierarchy, unit of hierarchical complexity, transactional capacity of institutions, institutional (institutional) competition.

Comparative Economics of Maize Cultivation under Conventional and Mechanization

Aim: To compare the cost and return analysis of conventional maize cultivation with mechanization.
 Place of Study: A field experiment on maize crop cultivation by conventional and mechanization was conducted at Agricultural Research Station, Karimnagar during Kharif, 2019-20.
 Methodology: The cost concepts were used to estimate the cost of cultivation under conventional and Mechanization methods. The cost concepts viz., cost A1, cost A2 cost B1 cost B2 and cost C1, cost C2 and C3 were used in the present study.
 Results: The total costs of cultivation under conventional and mechanization methods were Rs.117794.78 and Rs.104137.92 per hectare respectively indicating 12 % saving with mechanization. Similarly gross returns were Rs. 146064.00 in conventional method against Rs.146988.00 in mechanized method. Net returns recovered were 52% higher with mechanized method i.e Rs.42850.08 compared to conventional method Rs.28269.22. In the same way returns per rupee of investment in conventional method and mechanization were 1.23 and 1.41. Mechanization in cultivation also saves time, labour usage and reduces drudgery.

Optimizing the resource cost in multiple resources allocation problem with parametric uncertainties

Process industries often utilize a large number of valuable resources. To minimize operating costs and to promote sustainability, it is essential to prevent the overuse of resources. In conjunction with the prioritized cost concept, Pinch Analysis helps in achieving cost-optimal multi-resource allocation networks. Previous works were restricted to optimizing resource allocation networks with deterministic parameters without considering uncertainties associated with them. Uncertainties in source and resource parameters are incorporated in this paper through chance-constrained programming and solved through Pinch-based and numerical optimization-based methods. The notion of prioritized cost is extended to include uncertainties in various network parameters. Based on specified reliability for the multi-resource allocation network, the proposed approach determines the optimal operating cost of the network, and the results are verified through Monte Carlo simulations. Two examples from the field of water conservation and material conservation are solved to establish the utility of the proposed method. Optimal combinations of resources are pictorially represented at different cost ratios through a novel sensitivity diagram.

Hydraulic optimization of the physical parameters of a drinking water distribution system

Drinking-water distribution systems are generally designed with methodologies based on trial-and-error tests, which generate feasible results. However, these trials are not the most economical and reliable solution since they do not consider the optimization of the network. For the present work, the hydraulic model of the drinking water distribution network of San José de Cúcuta, Colombia, was optimized by applying the concept of resilience rate and minimum cost. The development of the work consisted of the hydraulic modeling of the physical components of the network in EPANET software, as well as the application of calculations of the connectivity coefficient and the unitary power of each section. With the data obtained from the modeling and calculations, the physical parameters were optimized, and the cost-benefit ratio was estimated. It was found that the current drinking water distribution system does not have a power surplus to overcome a system failure. The optimization increased the total energy surplus of the network (261%) and the resilience rate (585%). Also, the connectivity coefficient was improved with an average value of 0.95. The hydraulic optimization methodology applied resulted in a network resilient to system failures.

COMPARATIVE ANALYSIS OF TOMATO MARKETING IN KARNATAKA STATE OF INDIA AND KANO STATE OF NIGERIA

This study was carried out with the aim of comparing the profitability of tomato marketing in Karnataka state of India and Kano state of Nigeria. A total of 120 tomato growers (60 from each study area) were sampled through random sampling method and interviewed with structured questionnaire. Farm budgeting (net marketing margin) and cost concept techniques as used in India were used to analyze the primary data. The study revealed that in both study areas of India and Nigeria, tomato produced passes through several intermediaries in different marketing channels with little or no value being added before reaching the end users. Therefore, farmers were forced to capture a lower share of profit margin. In India, the producer’s share in consumer’s rupee across the different marketing channels were found to be 85.50%, 82.14% and 75.68%; and 70.68%, 63.66% and 36.92%% for Nigeria. Hence, based on findings of these research, the hypothesis that marketing channels with higher number of intermediaries reduces the producer share in consumer’s rupee holds true in both study areas and it is hereby accepted.

Accounting in Marketing Perspective Training Batch III, Sekolah Bisnis dan Manajemen – Institut Teknologi Bandung (SBM-ITB)

Managerial accounting is an activity or process that produces information that is useful for management for making economic decisions in carrying out management functions. Sekolah Binis dan Manajemen – Institut Teknologi Bandung (SBM-ITB) collaborated with the MarkPlus Institute to carry out the OMNI MBA Program 2020 Batch III on February 5, 2021. Out of the twelve subject topics contained in the program, one of them is entitled Accounting in Marketing Perspective that scheduled on Friday, 5 February 2021 with the author as the facilitator. The subjects include the Break-Even Point (BEP) theory, the Cost Classifications theory with the concept of Different Cost for Different Purposes, as well as related case studies. This training is expected to increase the competence and productivity of company managers in maximizing their role. This training went smoothly because of the strong enthusiasm of the participants. In addition, the inhibiting factor is the limited training time.

Development of the Oncology Opportunity Cost Assessment Tool: Item Generation and Content Validity Testing.

The purpose of this study was to develop the Oncology Opportunity Cost Assessment Tool (OOCAT), a survey instrument to evaluate the opportunity costs patients experience when seeking medical oncology care. Development of the OOCAT involved extensive patient engagement through both focus groups and interviews. First, the study team developed a list of opportunity cost concepts, which included patients' logistical and financial considerations related to seeking care. We conducted focus groups with patients to expand upon this list of concepts, and then developed a set of questions that incorporated all the concepts generated during the focus groups. To refine these questions, we next performed cognitive interviews with another set of patients to ensure content validity and clarity of instrument items, refining the OOCAT iteratively on the basis of feedback. We engaged 23 participants (17 patients and six caregivers) across four focus groups and 17 participants in cognitive interviews. Focus group participants generated 112 concepts, which resulted in an initial OOCAT with 16 questions. Cognitive interviews resulted in modification of 12 questions and addition of two questions (related to coordination of transportation and impact on home responsibilities). The final OOCAT consisted of 18 items examining time requirements for appointments, financial implications of traveling to appointments for the patient and the caregiver, and logistical and quality-of-life challenges associated with traveling for appointments. We developed the OOCAT, an instrument designed to evaluate patient-level opportunity costs of seeking medical oncology care. Further studies to validate the OOCAT are underway.

Knowing Your Product Costs: A Primer for Farmers and Food Entrepreneurs

This publication provides a basic introduction to product costing for farm businesses and food processing enterprises. It describes cost concepts, provides product costing examples, and briefly discusses software tools that can assist with cost analysis. The publication is intended to help farmers and food entrepreneurs understand product costing concepts and do their own cost calculations to assist with business decisions.

Target costing

The implementation of a cost control system in construction companies contributes to reducing resource losses in the production process and increasing business productivity and profitability, especially when it comes to small business, which normally do not have a planning system and efficient control. Therefore, this article aims to propose a target costing model for a small construction business, concerning the efficient evaluation of its costs for the maximization of profits in proposals to provide services to public entities. A case study is used, in which data collection occurred through a questionnaire, observations of the process of preparing financial proposals, other unstructured questions, and documentary search, whose approach includes descriptive and qualitative research. The survey results revealed that the enterprise has a cost control system, but is technologically backward. Besides, the enterprise already intuitively used the concepts of target cost in preparing budgets. After evaluating the costs, a target costing model was suggested for the enterprise to use as a parameter in the bidding processes, however, it was not implemented due to the current unfavorable conditions.

The Concept of the “Reverse Iceberg-RIB” in the Application of Account of Total Cost of Ownership for a Reusable Wooden Flat Pallet in its Operating Phase

Purpose: The main aim of this article is to show that the total cost of ownership of a pallet (which is not restricted to simply owning it) can become both a useful philosophy for purchasing these logistic carriers and an effective tool used to significantly reduce the costs of logistic activity of enterprises. Approach/Methodology/Design: Key dimensions of competition in the logistics area include the so-called golden triangle, i.e., time, quality and costs, and that is why they require a revision of the way we consider them, especially in case of the last aspect. This article presents an original approach to the problem of examination of all possible costs that cargo pallets generate in their operational life cycle, using the concept of Total Cost of Ownership (TCO) as an analysis methodology and the survey method for the research sample. Findings: In the reverse iceberg model, obvious and non-obvious costs have been identified in individual groups of costs related to pallet ownership during its operating phase. Considerations undertaken in this article lead to an obvious conclusion that an attempt to implement an approach to this important element of logistic infrastructure, and one can undoubtedly consider wooden cargo pallets as such, from the angle of account of costs allows to find grounds for taking real action leading to a significant reduction of costs of logistic activity in an enterprise. Practical Implications: The article employs a comprehensive approach to the most complete analysis of cost groups as possible since the authors have adopted a stance that omission of the potential to reduce costs related to material logistics in which wooden pallets are used requires a different perspective. Originality/Value: Numerous authors point to different sources and types of costs, and also present different views on how to define, interpret and identify their structure. The authors of this article propose thinking in terms of TCO as an alternative to the conventional approach to pallet-related costs at the same time postulating a standpoint based on their own model of inverted iceberg (RIB).