Constraints accounting is an

accounting Accounting, also known as accountancy, is the measurement, processing, and communication of financial and non financial information about economic entities such as businesses and corporations. Accounting, which has been called the "languag ...

technique, much like

throughput accounting Throughput accounting (TA) is a principle-based and simplified management accounting approach that provides managers with decision support information for enterprise profitability improvement. TA is relatively new in management accounting. It is a ...

, which focuses on ongoing improvement and implementation of the theory of constraints. It includes an explicit consideration of the role of constraints, a specification of throughput contribution effects, and the decoupling of throughput from operational expenses. Contrasting constraints accounting to

cost accounting Cost accounting is defined as "a systematic set of procedures for recording and reporting measurements of the cost of manufacturing goods and performing services in the aggregate and in detail. It includes methods for recognizing, classifying, al ...

, while cost accounting focuses on price per unit, constraints accounting focuses on price per unit-of-time. This measure is known as 'product octane.' Maximizing octane can greatly increase profitability. Constraints accounting may be confused with accounting constraints which are general limitations in the field of accounting.

References

{{reflist Management accounting