| Nontraditional and nonfinancial accounting information is increasingly used in decision making, yet this information may be cognitively processed different from more familiar financial information. This study investigates how evaluability information (EI) affects attribute evaluability and combines with the presentation of nontraditional and nonfinancial accounting information to influence management decisions. The primary theoretical proposition is the evaluability hypothesis (Hsee 1996), which states that difficult-to-evaluate data are weighted more when analyzing alternatives jointly (called joint evaluation mode, or JE) than separately (SE).;In Study One, participants were randomly assigned to an evaluation diode (EM), i.e., either JE or SE, with either none or complete supplemental EI, and with supplemental EI providing clearly or unclearly the same information as a relative comparison of the alternatives, in a 2X2X2 partial factorial design. Participants evaluated two equally important environmental accounting metrics for two factories and decided how much to invest in each; one factory was superior to the other. When supplemental EI signals were clear, EM and EI interacted to influence accuracy; specifically, participants invested more in the superior than inferior factory in JE than SE mode with no EI, but there was no difference in accuracy with complete EI. When the supplemental EI gave an unclear signal for worse-than-average alternatives (but not better-than-average), evaluations were more accurate in JE than SE mode.;In Study Two, EM was manipulated while EI was available for one of two metrics; the two factories were equally attractive. Findings showed investment differences across EM, and a preference reversal occurred in one setting, i.e. preferences for two equal alternatives reversed depending on the EM.;These studies extend the evaluability hypothesis as a framework for analyzing (1) an accounting domain, (2) management decisions involving unequally attractive alternatives, and (3) EM and EI effects on accuracy of decisions. A limitation of the studies is that the instrument's simple task may lead to results that are not generalizable to more complicated accounting settings. Overall, results suggest cost accountants and system designers must carefully consider EM and EI influences when presenting nontraditional and nonfinancial accounting information for decisions---such as decisions involving environmental considerations.;KEYWORDS: Management Decision Making, Environmental Accounting, Evaluability Hypothesis, Attribute Evaluability, Evaluation Mode... |
