Solution manual for Managerial Accounting 8th edition by john wild, ken shaw, barbara chiappetta Verified Chapter's 1 - 13 | Complete /////// Chapter 1: Managerial Accounting Concepts and Principles Chapter 2: Job Order Costing and Analysis C

Solution manual for Managerial Accounting 8th edition by john wild, ken shaw, barbara chiappetta Verified Chapter's 1 - 13 | Complete /////// Chapter 1: Managerial Accounting Concepts and Principles Chapter 2: Job Order Costing and Analysis Chapter 3: Process Costing and Analysis Chapter 4: Activity-Based Costing and Analysis Chapter 5: Cost Behavior and Cost-Volume-Profit Analysis Chapter 6: Variable Costing and Analysis Chapter 7: Master Budgets and Planning Chapter 8: Flexible Budgets and Standard Costs Chapter 9: Performance Measurement and Responsibility Accounting Chapter 10: Relevant Costs for Managerial Decisions Chapter 11: Capital Budgeting and Investment Analysis Chapter 12: Reporting Cash Flows Chapter 13: Analysis of Financial Statements Chapter 1 Managerial Accounting Concepts and Principles QUICK STUDIES Quick Study 1-1 (5 minutes) 1. 2. 3. 4. 5. Its primary users are company managers .............................. Managerial Its information is often available only after an audit is complete . Financial Its primary focus is on the organization as a whole .............. Financial Its principles and practices are relatively flexible ................. Managerial It focuses mainly on past results............................................. Financial Quick Study 1-2 (10 minutes) 1. 2. 3. 4. 5. Indirect cost Direct cost Indirect cost Indirect cost Direct cost Quick Study 1-3 (10 minutes) 1. Direct materials 2. Factory overhead 3. Direct labor 4. Factory overhead 5. Factory overhead 6. Direct materials Quick Study 1-4 (10 minutes) 1. Product cost 2. Period cost 3. Product cost 4. Period cost 5. Product cost 6. Period cost 7. Period cost 8. Product cost Quick Study 1-5 (10 minutes) 1. Prime cost 2. Conversion cost (Glue is an indirect material) 3. Both 4. Conversion cost 5. Conversion cost 6. Prime cost Quick Study 1-6 (10 minutes) Ending work in process inventory is computed as: Work in process inventory, beginning ............... $ 26,000 Direct materials used ....................................... 74,000 Direct labor used .............................................. 55,000 Factory overhead ............................................. 95,000 Total manufacturing costs .............................. 224,000 Total cost of work in process .............................. Less cost of goods manufactured ...................... 250,000 220,000 Work in process inventory, ending ..................... $ 30,000 Quick Study 1-6 (continued) Alternative calculation using T-account: Work in Process Inventory Beginning 26,000 Direct materials 74,000 Direct labor Factory overhead 55,000 95,000 220,000 COGM Ending 30,000 Quick Study 1-7 (10 minutes) Cost of goods sold is computed as: Finished goods inventory, beginning ................. $ 500 Cost of goods manufactured ............................... 4,000 Goods available for sale ...................................... 4,500 Less finished goods inventory, ending .............. 700 Cost of goods sold ............................................... $3,800 Quick Study 1-8 (10 minutes) Finished goods inventory, beginning ................ $ 345,000 Cost of goods manufactured .............................. 918,000 Goods available for sale ..................................... 1,263,000 Less finished goods inventory, ending ............. 283,000 Cost of goods sold .............................................. $ 980,000 Alternative calculation using T-account: Finished Goods Inventory Beginning 345,000 COGM 918,000 980,000 COGS Ending 283,000 Quick Study 1-9 (5 minutes) Cost of goods sold is computed as: Merchandise inventory, beginning ..................... $12,000 Cost of merchandise purchased ......................... 85,000 Goods available for sale ...................................... 97,000 Less merchandise inventory, ending ................. 18,000 Cost of goods sold ............................................... $79,000 Quick Study 1-10 (10 minutes) (1) (2) (3) Cost of merchandise purchased......... Merchandise inventory, beginning .... Merchandise inventory, ending .......... Cost of goods sold ............................... $181,000 $140,000 $289,000 106,000 82,000 205,000 21,000 33,000 128,000 28,000 50,000 267,000 Calculations: (1) $106,000 + Purchases - $205,000 = $82,000 Purchases = $181,000 (2) Beg. Inv. + $140,000 - $128,000 = $33,000 Beg. Inv. = $21,000 (3) $28,000 + $289,000 - $267,000 = End. Inv. End. Inv. = $50,000 Quick Study 1-11 (15 minutes) REX MANUFACTURING Income Statement For Year Ended December 31 Sales.................................................................. $92,000 Cost of goods sold Finished goods inventory, beginning ......... $ 19,000 Cost of goods manufactured ....................... 40,000 Goods available for sale .............................. 59,000 Less finished goods inventory, ending ...... 16,000 Cost of goods sold ....................................... 43,000 Gross profit ...................................................... 49,000 Selling expenses.............................................. 12,000 General and administrative expenses ........... 14,000 Net income........................................................ $23,000 Quick Study 1-12 (10 minutes) BIN MANUFACTURING Current Assets Section of the Balance Sheet December 31 Cash ........................................................ $22,000 Accounts receivable, net ...................... 12,000 Raw materials inventory ....................... 8,000 Work in process inventory.................... 18,000 Finished goods inventory ..................... 22,000 Prepaid insurance.................................. 4,000 Total current assets............................... $86,000 Quick Study 1-13 (10 minutes) Raw materials inventory, beginning ............................... $ 855 Raw materials purchased ................................................ 3,646 Raw materials available for use ...................................... 4,501 Less raw materials inventory, ending............................. 717 Direct materials used ....................................................... $3,784 Alternative calculation using T-account: Raw Materials Inventory Beginning 855 Purchased 3,646 3,784 Used Ending 717 Quick Study 1-14 (15 minutes) (1) (2) (3) Direct materials used ................ $ 8,000 $14,000 $32,000 Direct labor used ....................... 4,000 13,000 18,000 Factory overhead ...................... 5,000 23,000 22,000 Total manufacturing costs ........ 17,000 50,000 72,000 Calculations: (1) $8,000 + $4,000 + $5,000 = $17,000 (2) $14,000 + Direct labor + $23,000 = $50,000 DL = $13,000 (3) Direct materials + $18,000 + $22,000 = $72,000 DM = $32,000 Quick Study 1-15 (15 minutes) Barton Company Schedule of Cost of Goods Manufactured For Year Ended December 31 Direct materials .................................................... $190,000 Direct labor .......................................................... 63,000 Factory overhead ................................................. 24,000 Total manufacturing costs ................................. 277,000 Add work in process inventory, beginning........ 157,000 Total cost of work in process.............................. 434,000 Less work in process inventory, ending............ 142,000 Cost of goods manufactured .............................. $292,000 Verification calculation (not substitute) using T-account: Work in Process Inventory Beginning 157,000 Direct materials 190,000 Direct labor Factory overhead 63,000 24,000 292,000 COGM Ending 142,000 Quick Study 1-16 (10 minutes) Raw materials inventory, beginning ................ $ 6,000 Raw materials purchased ................................. 123,000 Raw materials available for use ....................... 129,000 Less raw materials inventory, ending.............. 7,000 Direct materials used ........................................ $122,000 Quick Study 1-17 (20 minutes) Part A Direct materials used*......................................... $122,000 Direct labor ......................................................... 94,000 Factory overhead ................................................ 39,000 Total manufacturing costs ................................ $255,000 *$6,000 + $123,000 - $7,000 = $122,000 direct materials used Part B Schedule of Cost of Goods Manufactured Direct materials Raw materials inventory, beginning............... $ 6,000 Raw materials purchases ............................... 123,000 Raw materials available for use ..................... 129,000 Less raw materials inventory, ending ............ 7,000 Direct materials used ...................................... $122,000 Direct labor .......................................................... 94,000 Factory overhead Indirect labor..................................................... 20,000 Depreciation expense—Factory...................... 15,000 Factory utilities ................................................. 4,000 Total factory overhead ..................................... 39,000 Total manufacturing costs ................................ 255,000 Add work in process inventory, beginning....... 12,000 Total cost of work in process ............................ 267,000 Less work in process inventory, ending........... 9,000 Cost of goods manufactured ............................. $258,000 Quick Study 1-18 (15 minutes) (1) (2) (3) Total manufacturing costs ...................... Work in process inventory, beginning ... Work in process inventory, ending ........ Cost of goods manufactured .................. $179,000 $150,000 $217,000 105,000 84,000 10,000 22,000 32,000 12,000 200,000 138,000 237,000 Calculations: (1) Mfg. costs + $105,000 - $200,000 = $84,000 Mfg. costs = $179,000 (2) $150,000 + Beg. Inv. - $138,000 = $22,000 Beg. Inv. = $10,000 (3) $217,000 + $32,000 - $237,000 = End. Inv. End. Inv. = $12,000 Quick Study 1-19 (5 minutes) Average manufacturing cost per unit = Cost of goods manufactured / Units produced Cost of goods manufactured ............. $918,700 Units produced................................... 18,374 Average unit cost................................ $ 50 E Quick Study 1-20 (10 minutes) 1. 4. A 2. 3. C B 5. D Quick Study 1-21 (10 minutes) Raw materials used ................................................................... Raw materials inventory, beginning ........................................ $5,000 900 Raw materials inventory, ending.............................................. 1,100 Total beginning plus ending raw materials inventory............ $2,000 Average raw materials inventory (Total / 2) ............................ $1,000 RM inventory turnover (RM used / Average RM inventory) ... 5.0 Days‘ sales in RM inventory [(End. RM inv./RM used) x 365].... 80 days EXERCISES Exercise 1-1 (10 minutes) Business Decision Primary Information Source 1. Determine whether to lend to a company .................. Financial 2. Evaluate a purchasing department‘s performance .... Managerial 3. Report financial performance to shareholders .......... Financial 4. Estimate product cost for a new line of shoes .......... Managerial 5. Plan the manufacturing budget for next quarter........ Managerial 6. Measure profitability of an individual store ............... Managerial 7. Prepare financial statements according to GAAP ..... Financial 8. Determine location and size for a new plant.............. Managerial Exercise 1-2 (10 minutes) Product Cost Direct or Indirect 1. Leather cover for soccer balls ............................. Direct 2. Annual flat fee paid for factory security ............. Indirect 3. Coolants for machinery ........................................ Indirect 4. Wages of product assembly workers ................. Direct 5. Factory supervisor salary .................................... Indirect 6. Taxes on factory.................................................... Indirect 7. Machinery depreciation (straight-line) ............... Indirect 8. Rubber bladder interior for balls ......................... Direct 9. Ink for labeling soccer balls................................. Indirect 10. Factory building rent ............................................. Indirect Exercise 1-3 (10 minutes) 1. Indirect 5. Indirect 2. Indirect 6. Direct 3. Direct 7. Indirect 4. Indirect 8. Direct Exercise 1-4 (10 minutes) Cost Classification 1. Advertising ................................................. Selling 2. Beverages served on plane ...................... Direct 3. Accounting manager salary...................... General and administrative 4. Depreciation on plane ............................... Indirect 5. Fuel used for plane flight .......................... Direct 6. Flight attendant wages for flight .............. Direct 7. Pilot wages for flight.................................. Direct 8. Aircraft maintenance manager salary...... Indirect Exercise 1-5 (10 minutes) 1. Direct material 5. Factory overhead 2. Factory overhead 6. Factory overhead 3. Direct labor 7. Selling expense 4. General and administrative expense 8. Factory overhead Exercise 1-6 (15 minutes) Product Costs Period Costs Costs Direct Materials Direct Labor Factory Overhead Selling Expense General & Admin. Expense 1. Factory electricity ........................... X 2. Advertising ...................................... X 3. Depreciation on factory machine .. X 4. Batteries for electric cars ............... X 5. Office supplies used....................... X 6. Wages to assembly workers .......... X 7. Salesperson commissions............. X 8. Steel for cars ................................... X 9. Depreciation on office equipment . X 10. Leather for car seats....................... X