Solution Manual for Managerial Accounting,
bl bl bl bl
18th Edition by Garrison, Noreen and Brewer
bl bl bl bl bl bl
Verified Chapter's 1 - 16 | Complete
bl bl bl bl bl bl
,Table of Contents
bl bl
Chapter blOne: blManagerial blAccounting bland blCost blConcepts
Chapter blTwo: blJob-Order blCosting: blCalculating blUnit blProduct blCosts
Chapter blThree: blJob-Order blCosting: blCost blFlows bland blExternal blReporting
Chapter blFour: blProcess blCosting
Chapter blFive: blCost-Volume-Profit blRelationships
Chapter blSix: blVariable blCosting bland blSegment blReporting: blTools blfor blManagement
Chapter blSeven: blActivity-Based blCosting: blA blTool blto blAid blDecision blMaking
Chapter blEight: blMaster blBudgeting
Chapter blNine: blFlexible blBudgets bland blPerformance blAnalysis
Chapter blTen: blStandard blCosts bland blVariances
Chapter blEleven: blResponsibility blAccounting blSystems
Chapter blTwelve: blStrategic blPerformance blMeasurement
Chapter blThirteen: blDifferential blAnalysis: blThe blKey blto blDecision blMaking
Chapter blFourteen: blCapital blBudgeting blDecisions
Chapter blFifteen: blStatement blof blCash blFlows
Chapter blSixteen: blFinancial blStatement blAnalysis
,Chapter 1 bl
Managerial Accounting and Cost Concepts
bl bl bl bl
Questions
1-1 The blthree blmajor bltypes blof blproduct blcosts blin 1-4
bla blmanufacturing blcompany blare bldirect blmaterials, a. Variable blcost: blThe blvariable blcost blper blunit blis
bldirect bllabor, bland blmanufacturing bloverhead. blconstant, blbut bltotal blvariable blcost blchanges blin
bldirect blproportion blto blchanges blin blvolume.
1-2 b. Fixed blcost: blThe bltotal blfixed blcost blis blconstant
a. Direct blmaterials blare blan blintegral blpart blof bla blwithin blthe blrelevant blrange. blThe blaverage blfixed
blfinished blproduct bland bltheir blcosts blcan blbe blcost blper blunit blvaries blinversely blwith blchanges
blconveniently bltraced blto blit. b l in blvolume.
b. Indirect blmaterials blare blgenerally blsmall blitems c. Mixed blcost: blA blmixed blcost blcontains blboth
blof blmaterial blsuch blas blglue bland blnails. blThey blmay blbe blvariable bland blfixed blcost blelements.
blan blintegral blpart blof bla blfinished blproduct blbut bltheir
blcosts blcan blbe bltraced blto blthe blproduct blonly blat 1-5
blgreat blcost blor blinconvenience.
a. Unit blfixed blcosts bldecrease blas blthe blactivity bllevel
c. Direct bllabor blconsists blof bllabor blcosts blthat blincreases.
blcan blbe bleasily bltraced blto blparticular blproducts.
b. Unit blvariable blcosts blremain blconstant blas blthe
Direct bllabor blis blalso blcalled bl―touch bllabor.‖ blactivity bllevel blincreases.
d. Indirect bllabor blconsists blof blthe bllabor blcosts c. Total blfixed blcosts blremain blconstant blas blthe
blof bljanitors, blsupervisors, blmaterials blhandlers, bland blactivity bllevel blincreases.
blother blfactory blworkers blthat blcannot blbe
d. Total blvariable blcosts blincrease blas blthe blactivity
blconveniently bltraced blto blparticular blproducts. blThese
bllevel blincreases.
bllabor blcosts blare blincurred blto blsupport blproduction,
blbut blthe blworkers blinvolved bldo blnot bldirectly blwork
1-6
blon blthe blproduct.
a. Cost blbehavior: blCost blbehavior blrefers blto blthe
e. Manufacturing bloverhead blincludes blall
blway blin blwhich blcosts blchange blin blresponse blto
blmanufacturing blcosts blexcept bldirect blmaterials bland
blchanges blin bla blmeasure blof blactivity blsuch blas
bldirect bllabor. blConsequently, blmanufacturing
blsales blvolume, blproduction blvolume, blor blorders
bloverhead blincludes blindirect blmaterials bland blindirect
blprocessed.
bllabor blas blwell blas blother blmanufacturing blcosts.
b. Relevant blrange: blThe blrelevant blrange blis blthe
blrange blof blactivity blwithin blwhich blassumptions
1-3 A blproduct blcost blis blany blcost blinvolved blin
blabout blvariable bland blfixed blcost blbehavior
blpurchasing blor blmanufacturing blgoods. blIn blthe blcase
blare blvalid.
blof blmanufactured blgoods, blthese blcosts blconsist blof
bldirect blmaterials, bldirect bllabor, bland blmanufacturing
bloverhead. blA blperiod blcost blis bla blcost blthat blis bltaken
1-7 An blactivity blbase blis bla blmeasure blof
blwhatever blcauses blthe blincurrence blof bla blvariable
bldirectly blto blthe blincome blstatement blas blan blexpense
blcost. blExamples blof blactivity blbases blinclude blunits
blin blthe blperiod blin blwhich blit blis blincurred.
blproduced, blunits blsold, blletters bltyped, blbeds blin bla
blhospital, blmeals blserved blin bla blcafe, blservice blcalls
blmade, bletc.
1-8 The bllinear blassumption blis blreasonably blvalid
blproviding blthat blthe blcost blformula blis blused blonly blwithin
blthe blrelevant blrange.
, 1-9 A bldiscretionary blfixed blcost blhas bla blfairly 1-11 The bltraditional blapproach blorganizes blcosts
blshort blplanning blhorizon—usually bla blyear. blSuch blby blfunction, blsuch blas blproduction, blselling, bland
blcosts blarise blfrom blannual bldecisions blby bladministration. blWithin bla blfunctional blarea, blfixed
blmanagement blto blspend blon blcertain blfixed blcost bland blvariable blcosts blare blintermingled. blThe
blitems, blsuch blas bladvertising, blresearch, bland blcontribution blapproach blincome blstatement blorganizes
blmanagement bldevelopment. blA blcommitted blfixed blcosts blby blbehavior, blfirst bldeducting blvariable
blcost blhas bla bllong blplanning blhorizon—generally blexpenses blto blobtain blcontribution blmargin, bland blthen
blmany blyears. blSuch blcosts blrelate blto bla blcompany’s bldeducting blfixed blexpenses blto blobtain blnet bloperating
blinvestment blin blfacilities, blequipment, bland blbasic blincome.
blorganization. blOnce blsuch blcosts blhave blbeen
blincurred, blthey blare bl―locked blin‖ blfor blmany blyears. 1-12 The blcontribution blmargin blis bltotal blsales
blrevenue blless bltotal blvariable blexpenses.
1-10 Yes. blAs blthe blanticipated bllevel blof blactivity
blchanges, blthe bllevel blof blfixed blcosts blneeded blto 1-13 A bldifferential blcost blis bla blcost blthat bldiffers
blsupport bloperations blmay blalso blchange. blMost blfixed blbetween blalternatives blin bla bldecision. blA blsunk blcost
blcosts blare bladjusted blupward bland bldownward blin b l is bla blcost blthat blhas blalready blbeen blincurred bland
bllarge blsteps, blrather blthan blbeing blabsolutely blfixed blat blcannot blbe blaltered blby blany bldecision bltaken blnow blor
blone bllevel blfor blall blranges blof blactivity. blin blthe blfuture. blAn blopportunity blcost blis blthe blpotential
blbenefit blthat blis blgiven blup blwhen blone blalternative blis
blselected blover blanother.
1-14 No, bldifferential blcosts blcan blbe bleither
blvariable blor blfixed. blFor blexample, blthe blalternatives
blmight blconsist blof blpurchasing blone blmachine blrather
blthan blanother blto blmake bla blproduct. blThe bldifference
blbetween blthe blfixed blcosts blof blpurchasing blthe bltwo
blmachines blis bla bldifferential blcost.
Managerial blAccounting bl18th blEdition, blSolutions blManual,
bl bl bl bl
18th Edition by Garrison, Noreen and Brewer
bl bl bl bl bl bl
Verified Chapter's 1 - 16 | Complete
bl bl bl bl bl bl
,Table of Contents
bl bl
Chapter blOne: blManagerial blAccounting bland blCost blConcepts
Chapter blTwo: blJob-Order blCosting: blCalculating blUnit blProduct blCosts
Chapter blThree: blJob-Order blCosting: blCost blFlows bland blExternal blReporting
Chapter blFour: blProcess blCosting
Chapter blFive: blCost-Volume-Profit blRelationships
Chapter blSix: blVariable blCosting bland blSegment blReporting: blTools blfor blManagement
Chapter blSeven: blActivity-Based blCosting: blA blTool blto blAid blDecision blMaking
Chapter blEight: blMaster blBudgeting
Chapter blNine: blFlexible blBudgets bland blPerformance blAnalysis
Chapter blTen: blStandard blCosts bland blVariances
Chapter blEleven: blResponsibility blAccounting blSystems
Chapter blTwelve: blStrategic blPerformance blMeasurement
Chapter blThirteen: blDifferential blAnalysis: blThe blKey blto blDecision blMaking
Chapter blFourteen: blCapital blBudgeting blDecisions
Chapter blFifteen: blStatement blof blCash blFlows
Chapter blSixteen: blFinancial blStatement blAnalysis
,Chapter 1 bl
Managerial Accounting and Cost Concepts
bl bl bl bl
Questions
1-1 The blthree blmajor bltypes blof blproduct blcosts blin 1-4
bla blmanufacturing blcompany blare bldirect blmaterials, a. Variable blcost: blThe blvariable blcost blper blunit blis
bldirect bllabor, bland blmanufacturing bloverhead. blconstant, blbut bltotal blvariable blcost blchanges blin
bldirect blproportion blto blchanges blin blvolume.
1-2 b. Fixed blcost: blThe bltotal blfixed blcost blis blconstant
a. Direct blmaterials blare blan blintegral blpart blof bla blwithin blthe blrelevant blrange. blThe blaverage blfixed
blfinished blproduct bland bltheir blcosts blcan blbe blcost blper blunit blvaries blinversely blwith blchanges
blconveniently bltraced blto blit. b l in blvolume.
b. Indirect blmaterials blare blgenerally blsmall blitems c. Mixed blcost: blA blmixed blcost blcontains blboth
blof blmaterial blsuch blas blglue bland blnails. blThey blmay blbe blvariable bland blfixed blcost blelements.
blan blintegral blpart blof bla blfinished blproduct blbut bltheir
blcosts blcan blbe bltraced blto blthe blproduct blonly blat 1-5
blgreat blcost blor blinconvenience.
a. Unit blfixed blcosts bldecrease blas blthe blactivity bllevel
c. Direct bllabor blconsists blof bllabor blcosts blthat blincreases.
blcan blbe bleasily bltraced blto blparticular blproducts.
b. Unit blvariable blcosts blremain blconstant blas blthe
Direct bllabor blis blalso blcalled bl―touch bllabor.‖ blactivity bllevel blincreases.
d. Indirect bllabor blconsists blof blthe bllabor blcosts c. Total blfixed blcosts blremain blconstant blas blthe
blof bljanitors, blsupervisors, blmaterials blhandlers, bland blactivity bllevel blincreases.
blother blfactory blworkers blthat blcannot blbe
d. Total blvariable blcosts blincrease blas blthe blactivity
blconveniently bltraced blto blparticular blproducts. blThese
bllevel blincreases.
bllabor blcosts blare blincurred blto blsupport blproduction,
blbut blthe blworkers blinvolved bldo blnot bldirectly blwork
1-6
blon blthe blproduct.
a. Cost blbehavior: blCost blbehavior blrefers blto blthe
e. Manufacturing bloverhead blincludes blall
blway blin blwhich blcosts blchange blin blresponse blto
blmanufacturing blcosts blexcept bldirect blmaterials bland
blchanges blin bla blmeasure blof blactivity blsuch blas
bldirect bllabor. blConsequently, blmanufacturing
blsales blvolume, blproduction blvolume, blor blorders
bloverhead blincludes blindirect blmaterials bland blindirect
blprocessed.
bllabor blas blwell blas blother blmanufacturing blcosts.
b. Relevant blrange: blThe blrelevant blrange blis blthe
blrange blof blactivity blwithin blwhich blassumptions
1-3 A blproduct blcost blis blany blcost blinvolved blin
blabout blvariable bland blfixed blcost blbehavior
blpurchasing blor blmanufacturing blgoods. blIn blthe blcase
blare blvalid.
blof blmanufactured blgoods, blthese blcosts blconsist blof
bldirect blmaterials, bldirect bllabor, bland blmanufacturing
bloverhead. blA blperiod blcost blis bla blcost blthat blis bltaken
1-7 An blactivity blbase blis bla blmeasure blof
blwhatever blcauses blthe blincurrence blof bla blvariable
bldirectly blto blthe blincome blstatement blas blan blexpense
blcost. blExamples blof blactivity blbases blinclude blunits
blin blthe blperiod blin blwhich blit blis blincurred.
blproduced, blunits blsold, blletters bltyped, blbeds blin bla
blhospital, blmeals blserved blin bla blcafe, blservice blcalls
blmade, bletc.
1-8 The bllinear blassumption blis blreasonably blvalid
blproviding blthat blthe blcost blformula blis blused blonly blwithin
blthe blrelevant blrange.
, 1-9 A bldiscretionary blfixed blcost blhas bla blfairly 1-11 The bltraditional blapproach blorganizes blcosts
blshort blplanning blhorizon—usually bla blyear. blSuch blby blfunction, blsuch blas blproduction, blselling, bland
blcosts blarise blfrom blannual bldecisions blby bladministration. blWithin bla blfunctional blarea, blfixed
blmanagement blto blspend blon blcertain blfixed blcost bland blvariable blcosts blare blintermingled. blThe
blitems, blsuch blas bladvertising, blresearch, bland blcontribution blapproach blincome blstatement blorganizes
blmanagement bldevelopment. blA blcommitted blfixed blcosts blby blbehavior, blfirst bldeducting blvariable
blcost blhas bla bllong blplanning blhorizon—generally blexpenses blto blobtain blcontribution blmargin, bland blthen
blmany blyears. blSuch blcosts blrelate blto bla blcompany’s bldeducting blfixed blexpenses blto blobtain blnet bloperating
blinvestment blin blfacilities, blequipment, bland blbasic blincome.
blorganization. blOnce blsuch blcosts blhave blbeen
blincurred, blthey blare bl―locked blin‖ blfor blmany blyears. 1-12 The blcontribution blmargin blis bltotal blsales
blrevenue blless bltotal blvariable blexpenses.
1-10 Yes. blAs blthe blanticipated bllevel blof blactivity
blchanges, blthe bllevel blof blfixed blcosts blneeded blto 1-13 A bldifferential blcost blis bla blcost blthat bldiffers
blsupport bloperations blmay blalso blchange. blMost blfixed blbetween blalternatives blin bla bldecision. blA blsunk blcost
blcosts blare bladjusted blupward bland bldownward blin b l is bla blcost blthat blhas blalready blbeen blincurred bland
bllarge blsteps, blrather blthan blbeing blabsolutely blfixed blat blcannot blbe blaltered blby blany bldecision bltaken blnow blor
blone bllevel blfor blall blranges blof blactivity. blin blthe blfuture. blAn blopportunity blcost blis blthe blpotential
blbenefit blthat blis blgiven blup blwhen blone blalternative blis
blselected blover blanother.
1-14 No, bldifferential blcosts blcan blbe bleither
blvariable blor blfixed. blFor blexample, blthe blalternatives
blmight blconsist blof blpurchasing blone blmachine blrather
blthan blanother blto blmake bla blproduct. blThe bldifference
blbetween blthe blfixed blcosts blof blpurchasing blthe bltwo
blmachines blis bla bldifferential blcost.
Managerial blAccounting bl18th blEdition, blSolutions blManual,
