Cost stickiness: An empirical study on the existence of asymmetrical cost behavior of publicly listed companies in the Philippines

Date of Publication

2009

Document Type

Bachelor's Thesis

Degree Name

Bachelor of Science in Accountancy

Subject Categories

Accounting

College

Ramon V. Del Rosario College of Business

Department/Unit

Accountancy

Thesis Adviser

Arnel Onesimo O. Uy

Defense Panel Member

Helen A. Bernados
Corazon L. Magpayo

Abstract/Summary

The study utilized Anderson, Banker, and Janakiraman's (2003) basic model to test for the existence of asymmetrical behavior in SG&A costs for a sample of 74 Philippine publicly-listed companies over a 9-year period. The findings suggested that a 1% increase in revenue leads only to 0.3891% decrease in costs, thus demonstrating the existence of asymmetrical cost behavior. Variations revealed that cost stickiness is not reversed in subsequent periods and it is less pronounced when revenue declined in the preceding period. Empirical evidence showed that the degree of stickiness is greater during periods of economic growth and does not increase with the asset-and employee-intensity of the company. Lastly, stickiness is only exhibited for absolute revenue changes over 60%.

Abstract Format

html

Note

Running head: Cost stickiness.

Language

English

Format

Print

Accession Number

TU15984

Shelf Location

Archives, The Learning Commons, 12F, Henry Sy Sr. Hall

Physical Description

97 leaves : col. ill. ; 28 cm.

Keywords

Cost accounting; Managerial accounting; Financial risk management

Embargo Period

12-13-2021

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