Solution Manual for Management
b b b
b Accounting for Decision Makers:
b b b b
11th Edition By Peter Atrill, Eddie McLaney All
b b b b b b b
b Chapters 1 - 12 b b b b
,TABLEOFCONTENTS
b b
1. Introduction to management accounting b b b
2. Relevant costs and benefits for decision making
b b b b b b
3. Cost–volume–profit analysis b
4. Full costing
b
5. Costing and cost management in a competitive environment
b b b b b b b
6. Budgeting
7. Accounting for control b b
8. Making capital investment decisions
b b b
9. Managing risk b
10. Strategic management accounting: performance evaluation and pricing in a
b b b b b b b b
competitive environment
b b
11. Measuring divisional performance
b b
12. Managing working capital b b
, SECTION A b
Authors’notetotutors b b b
Using the book b b
The book is designed to provide readers with a sound introduction to management accounting. It assumes
b b b b b b b b b b b b b b b
no previous knowledge of the subject and recognises that students using it may come from a wide variety
b b b b b b b b b b b b b b b b b b
of backgrounds. The book, therefore, tries to avoid technical jargon and does not assume a high level of
b b b b b b b b b b b b b b b b b b
numerical ability from students. It has been class tested by students on various courses and we have
b b b b b b b b b b b b b b b b b
modified and refined the material to take account of their comments. We have also taken account of the
b b b b b b b b b b b b b b b b b b
comments made by lecturers who used the first nine editions of the book and of specially commissioned
b b b b b b b b b b b b b b b b b
reviews.
b
The book aims to encourage an active approach to learning by providing activities and self-assessment
b b b b b b b b b b b b b b
questions at appropriate points. This approach is designed to stimulate thought concerning particular
b b b b b b b b b b b b b
issuesandtogivethereaderstheopportunitytotesttheirunderstandingoftheprinciplescovered.
b b b b b b b b b b b b b b b b
The book is supplemented by a password-controlled lecturers’ website and a student website available to
b b b b b b b b b b b b b b
all readers.
b b
The structure of the book allows the tutor to deliver the subject in a number of ways. It can be used as
b b b b b b b b b b b b b b b b b b b b b
recommended reading for a traditional course based on lectures and tutorials. There are critical review
b b b b b b b b b b b b b b b
questions and exercises at the end of each chapter that can be used as the basis for tutorials. It could also
b b b b b b b b b b b b b b b b b b b b b
provide the basis for a distance learning approach for part-time or off-campus students. For these
b b b b b b b b b b b b b b b
students, the interactive nature of the book may be extremely useful where access to a tutor is restricted.
b b b b b b b b b b b b b b b b b b
The book can also be used as the basis for an open learning approach for full-time campus-based students.
b b b b b b b b b b b b b b b b b b
We have successfully used it in this way at the University of Plymouth Business School. Accounting
b b b b b b b b b b b b b b b b
‘surgeries’ have also been provided to give students the opportunity for one-to-one help with any
b b b b b b b b b b b b b b b
problems they face.
b b b
The book is appropriate for modules that are designed to be covered in 100 to 150 hours of study. For full-
b b b b b b b b b b b b b b b b b b b b
time students, this will often be covered in one academic year.
b b b b b b b b b b
PowerPointslides b
The diagrams in the book, along with other diagrams and materials, are available as PowerPoint slides to
b b b b b b b b b b b b b b b b
help in delivering lectures and tutorials and these can be downloaded from the lecturers’ website.
b b b b b b b b b b b b b b b
Practice/assessmentmaterial b
The activities, whose solutions immediately follow them, and self-assessment questions, whose solutions
b b b b b b b b b b b
are at the end of the book, form an integral part of it. In addition, there are various other
b b b b b b b b b b b b b b b b b b b
, practice/assessment materials. At the end of each chapter there are four critical review questions. These b b b b b b b b b b b b b b
are short, narrative questions involving recall, explanation and brief discussion. The solutions to these are
b b b b b b b b b b b b b b b
given at the end of the book. At the end of all chapters, except Chapter 1 (where there are two), there are
b b b b b b b b b b b b b b b b b b b b b b
eight exercises. These are questions, many involving calculations, which are similar in nature to
b b b b b b b b b b b b b b
examination-style questions. The solutions to five of these are given at the end of the book and are,
b b b b b b b b b b b b b b b b b b
therefore, accessible to students. Solutions to the other three are in the following pages of this manual and
b b b b b b b b b b b b b b b b b b
are not accessible to students.
b b b b b
On the lecturers’ website, in addition to this Instructor’s Manual with solutions to selected end-of- chapter
b b b b b b b b b b b b b b b
exercises there are:
b b b
• Two progress tests with solutions. These tests comprise multiple-choice questions, missing- word
b b b b b b b b b b b
questions and questions that are similar to the end-of-chapter exercises. One test corresponds to
b b b b b b b b b b b b b b
Chapters 1 to 5, and the other to Chapters 6 to 12.
b b b b b b b b b b b b
• Supplementaryquestions(10ofthem)withsolutions. b b b b b b
• Tutorial/seminarquestionswithsolutions. b b b
None of this material, exceptthecasestudy comments,isaccessible to students. On the
b b b b b b b b b b b b b b
student website, there are five types of material:
b b b b b b b b
• Revisionexercises,similarinstyletotheend-of-chapterexercises,withsolutions. b b b b b b b b b b
• Multiple-choice questions, typically 10 for each chapter. These are intended to be tackled online, b b b b b b b b b b b b b
where they will be automatically graded.
b b b b b b
• Missing-word questions, typically 10 for each chapter. These too can be attempted and graded online. b b b b b b b b b b b b b b
The multiple-choice questions and missing-word questions are intended to provide students with a quick
b b b b b b b b b b b b b
assessment of their mastery of the material of each chapter.
b b b b b b b b b b
The solutions to all of this material, except to the multiple-choice and missing-word questions, are fully
b b b b b b b b b b b b b b b
annotated in order to give the necessary feedback to students.
b b b b b b b b b b
We intend to expand the number and scope of the practice/assessment materials on a continuing basis.
b b b b b b b b b b b b b b b
We hope that you and your students will find the book both accessible and interesting. We should much
b b b b b b b b b b b b b b b b b
appreciate any suggestions you may have on how the book and supplementary material may be improved.
b b b b b b b b b b b b b b b b
Peter Atrill b
EddieMcLaney
b b
b b b
b Accounting for Decision Makers:
b b b b
11th Edition By Peter Atrill, Eddie McLaney All
b b b b b b b
b Chapters 1 - 12 b b b b
,TABLEOFCONTENTS
b b
1. Introduction to management accounting b b b
2. Relevant costs and benefits for decision making
b b b b b b
3. Cost–volume–profit analysis b
4. Full costing
b
5. Costing and cost management in a competitive environment
b b b b b b b
6. Budgeting
7. Accounting for control b b
8. Making capital investment decisions
b b b
9. Managing risk b
10. Strategic management accounting: performance evaluation and pricing in a
b b b b b b b b
competitive environment
b b
11. Measuring divisional performance
b b
12. Managing working capital b b
, SECTION A b
Authors’notetotutors b b b
Using the book b b
The book is designed to provide readers with a sound introduction to management accounting. It assumes
b b b b b b b b b b b b b b b
no previous knowledge of the subject and recognises that students using it may come from a wide variety
b b b b b b b b b b b b b b b b b b
of backgrounds. The book, therefore, tries to avoid technical jargon and does not assume a high level of
b b b b b b b b b b b b b b b b b b
numerical ability from students. It has been class tested by students on various courses and we have
b b b b b b b b b b b b b b b b b
modified and refined the material to take account of their comments. We have also taken account of the
b b b b b b b b b b b b b b b b b b
comments made by lecturers who used the first nine editions of the book and of specially commissioned
b b b b b b b b b b b b b b b b b
reviews.
b
The book aims to encourage an active approach to learning by providing activities and self-assessment
b b b b b b b b b b b b b b
questions at appropriate points. This approach is designed to stimulate thought concerning particular
b b b b b b b b b b b b b
issuesandtogivethereaderstheopportunitytotesttheirunderstandingoftheprinciplescovered.
b b b b b b b b b b b b b b b b
The book is supplemented by a password-controlled lecturers’ website and a student website available to
b b b b b b b b b b b b b b
all readers.
b b
The structure of the book allows the tutor to deliver the subject in a number of ways. It can be used as
b b b b b b b b b b b b b b b b b b b b b
recommended reading for a traditional course based on lectures and tutorials. There are critical review
b b b b b b b b b b b b b b b
questions and exercises at the end of each chapter that can be used as the basis for tutorials. It could also
b b b b b b b b b b b b b b b b b b b b b
provide the basis for a distance learning approach for part-time or off-campus students. For these
b b b b b b b b b b b b b b b
students, the interactive nature of the book may be extremely useful where access to a tutor is restricted.
b b b b b b b b b b b b b b b b b b
The book can also be used as the basis for an open learning approach for full-time campus-based students.
b b b b b b b b b b b b b b b b b b
We have successfully used it in this way at the University of Plymouth Business School. Accounting
b b b b b b b b b b b b b b b b
‘surgeries’ have also been provided to give students the opportunity for one-to-one help with any
b b b b b b b b b b b b b b b
problems they face.
b b b
The book is appropriate for modules that are designed to be covered in 100 to 150 hours of study. For full-
b b b b b b b b b b b b b b b b b b b b
time students, this will often be covered in one academic year.
b b b b b b b b b b
PowerPointslides b
The diagrams in the book, along with other diagrams and materials, are available as PowerPoint slides to
b b b b b b b b b b b b b b b b
help in delivering lectures and tutorials and these can be downloaded from the lecturers’ website.
b b b b b b b b b b b b b b b
Practice/assessmentmaterial b
The activities, whose solutions immediately follow them, and self-assessment questions, whose solutions
b b b b b b b b b b b
are at the end of the book, form an integral part of it. In addition, there are various other
b b b b b b b b b b b b b b b b b b b
, practice/assessment materials. At the end of each chapter there are four critical review questions. These b b b b b b b b b b b b b b
are short, narrative questions involving recall, explanation and brief discussion. The solutions to these are
b b b b b b b b b b b b b b b
given at the end of the book. At the end of all chapters, except Chapter 1 (where there are two), there are
b b b b b b b b b b b b b b b b b b b b b b
eight exercises. These are questions, many involving calculations, which are similar in nature to
b b b b b b b b b b b b b b
examination-style questions. The solutions to five of these are given at the end of the book and are,
b b b b b b b b b b b b b b b b b b
therefore, accessible to students. Solutions to the other three are in the following pages of this manual and
b b b b b b b b b b b b b b b b b b
are not accessible to students.
b b b b b
On the lecturers’ website, in addition to this Instructor’s Manual with solutions to selected end-of- chapter
b b b b b b b b b b b b b b b
exercises there are:
b b b
• Two progress tests with solutions. These tests comprise multiple-choice questions, missing- word
b b b b b b b b b b b
questions and questions that are similar to the end-of-chapter exercises. One test corresponds to
b b b b b b b b b b b b b b
Chapters 1 to 5, and the other to Chapters 6 to 12.
b b b b b b b b b b b b
• Supplementaryquestions(10ofthem)withsolutions. b b b b b b
• Tutorial/seminarquestionswithsolutions. b b b
None of this material, exceptthecasestudy comments,isaccessible to students. On the
b b b b b b b b b b b b b b
student website, there are five types of material:
b b b b b b b b
• Revisionexercises,similarinstyletotheend-of-chapterexercises,withsolutions. b b b b b b b b b b
• Multiple-choice questions, typically 10 for each chapter. These are intended to be tackled online, b b b b b b b b b b b b b
where they will be automatically graded.
b b b b b b
• Missing-word questions, typically 10 for each chapter. These too can be attempted and graded online. b b b b b b b b b b b b b b
The multiple-choice questions and missing-word questions are intended to provide students with a quick
b b b b b b b b b b b b b
assessment of their mastery of the material of each chapter.
b b b b b b b b b b
The solutions to all of this material, except to the multiple-choice and missing-word questions, are fully
b b b b b b b b b b b b b b b
annotated in order to give the necessary feedback to students.
b b b b b b b b b b
We intend to expand the number and scope of the practice/assessment materials on a continuing basis.
b b b b b b b b b b b b b b b
We hope that you and your students will find the book both accessible and interesting. We should much
b b b b b b b b b b b b b b b b b
appreciate any suggestions you may have on how the book and supplementary material may be improved.
b b b b b b b b b b b b b b b b
Peter Atrill b
EddieMcLaney
b b
