SOLUTION MANUAL m
Horngren's Accounting, 13th Edition Managerial
m m m m
by Tracie Miller-Nobles, Brenda Mattison, All Chapter 1-9
m m m m m m m
,THE MANAGERIAL CHAPTERS
m m
1. Introduction to Managerial Accounting
m m m
2. Job Order Costing
m m
3. Process Costingm
4. Cost-Volume-Profit Analysis m
5. Master Budgets
m
6. Flexible Budgets and Standard Cost Systems
m m m m m
7. Cost Allocation and Responsibility Accounting
m m m m
8. Short-Term Business Decisions
m m
9. Capital Investment Decisions
m m
,Chapter 1 m
Introduction to Managerial Accounting
m m m
Review Questions
m
1. Themprimarympurposemofmmanagerialmaccountingmismtomprovideminformationmtomhelpmmanagersmplan,m
direct,mcontrol,mandmmakemdecisions.
2. Financialmaccountingmandmmanagerialmaccountingmdiffermonmthemfollowingm6mdimensions:m(1)mprimarymus
ers,m(2)mpurposemofminformation,m(3)mfocusmandmtimemdimensionmofmtheminformation,m(4)mrulesmandmrestr
ictions,m(5)mscopemofminformation,mandm(6)mbehavioral.
3. Linempositionsmaremdirectlyminvolvedminmprovidingmgoodsmormservicesmtomcustomers.mStaffmpositionsms
upportmlinempositions.
4. Planningmmeansmchoosingmgoalsmandmdecidingmhowmtomachievemthem.mDirectingminvolvesmrunningmthemda
y-to-
daymoperationsmofmambusiness.mControllingmismthemprocessmofmmonitoringmoperationsmandmkeepingmthemco
mpanymonmtrack.
5. ThemfourmIMAmstandardsmofmethicalmpracticemandmamdescriptionmofmeachmfollow.
I. Competence.
Maintainmanmappropriatemlevelmofmprofessionalmleadershipmandmexpertisembymenhancingmk
nowledgemandmskills.
Performmprofessionalmdutiesminmaccordancemwithmrelevantmlaws,mregulations,mandmtechnicalms
tandards.
Providemdecisionmsupportminformationmandmrecommendationsmthatmaremaccurate,mclear,mconcise,m
andmtimely.
Recognisemandmhelpmmangemrisk.
II. Confidentiality.
Keepminformationmconfidentialmexceptmwhenmdisclosuremismauthorizedmormlegallymrequired.
Informmallmrelevantmpartiesmregardingmappropriatemusemofmconfidentialminformation.m Monitormtom
ensuremcompliance.
Refrainmfrommusingmconfidentialminformationmformunethicalmormillegalmadvantage.
III. Integrity.
Mitigatemactualmconflictsmofminterest.mRegularlymcommunicatemwithmbusinessmassociatesmtomavoidma
pparentmconflictsmofminterest.mmAdvisemallmpartiesmofmanympotentialmconflicts.
Refrainmfrommengagingminmanymconductmthatmwouldmprejudicemcarryingmoutmdutiesmethically.
, Abstainmfrommengagingminmormsupportingmanymactivitymthatmmightmdiscreditmthemprofession.
Contributemtomampositivemethicalmculturemandmplacemintegritymofmthemprofessionmabovempersonalm
interest.
5,mcont.
IV. Credibility.
Communicateminformationmfairlymandmobjectively.
Providemallmrelevantminformationmthatmcouldmreasonablymbemexpectedmtominfluencemanmintendedm
user’smunderstandingmofmthemreports,manalyses,mormrecommendations.
Reportmanymdelaysmormdeficienciesminminformation,mtimeliness,mprocessing,morminternalmcontrolsmi
nmconformancemwithmorganizationmpolicymand/ormapplicablemlaw.
Communicatemanymprofessionalmlimitationsmormothermconstraintsmthatmwouldmprecludemresponsi-
blemjudgmentmormsuccessfulmperformancemofmanmactivity.
m
6. Servicemcompaniesmsellmtime,mskills,mandmknowledge.m Examplesmofmservicemcompaniesmincludemphonemse
rvicemcompanies,mbanks,mcleaningmservicemcompanies,maccountingmfirms,mlawmfirms,mmedicalmphysicians,
mandmonlinemauctionmservices.
7. Merchandisingmcompaniesmresellmproductsmtheymbuymfrommsuppliers.mMerchandisersmkeepmanminventorymof
mproducts,mandmmanagersmaremaccountablemformthempurchasing,mstorage,mandmsalemofmthemproducts.mExamp
lesmofmmerchandisingmcompaniesmincludemtoymstores,mgrocerymstores,mandmclothingmstores.
8. Merchandisingmcompaniesmresellmproductsmtheympreviouslymboughtmfrommsuppliers,mwhereasmmanufactur
ingmcompaniesmusemlabor,mequipment,msupplies,mandmfacilitiesmtomconvertmrawmmaterialsmintomnewmfinished
mproducts.mInmcontrastmtommerchandisingmcompanies,mmanufacturingmcompaniesmhavemambroadmrangemofm
productionmactivitiesmthatmrequiremtrackingmcostsmonmthreemkindsmofminventory.
9. ThemthreeminventorymaccountsmusedmbymmanufacturingmcompaniesmaremRawmMaterialsmInventory,mWork-
in-ProcessmInventory,mandmFinishedmGoodsmInventory.
m
RawmMaterialsmInventorymincludesmmaterialsmusedmtommanufacturemamproduct.mWork-in-
ProcessmInventorymincludesmgoodsmthatmhavembeenmstartedminmthemmanufacturingmprocessmbutmaremnotmyet
mcomplete.m FinishedmGoodsmInventorymincludesmcompletedmgoodsmthatmhavemnotmyetmbeenmsold.
10. Amdirectmcostmismamcostmthatmcanmbemeasilymandmcost-
effectivelymtracedmtomamcostmobjectm(whichmismanythingmformwhichmmanagersmwantmamseparatemmeasure
mentmofmcost).mAnmindirectmcostmismamcostmthatmcannotmbemeasilymormcost-
effectivelymtracedmtomamcostmobject.
11. Themthreemmanufacturingmcostsmformammanufacturingmcompanymaremdirectmmaterials,mdirectmlabor,mandmm
anufacturingmoverhead.mDirectmmaterialsmaremmaterialsmthatmbecomemamphysicalmpartmofmamfinishedmprodu
ctmandmwhosemcostsmaremeasilymtraceablemtomthemfinishedmproduct.m Directmlabormismthemlabormcostmofmtheme
mployeesmwhomconvertmmaterialsmintomfinishedmproducts.mManufacturingmoverheadmincludesmallmmanufac
turingmcostsmexceptmdirectmmaterialsmandmdirectmlabor,msuchmasmindirectmmaterials,mindirectmlabor,mfactorym
depreciation,mfactorymrent,mandmfactorympropertymtaxes.
Horngren's Accounting, 13th Edition Managerial
m m m m
by Tracie Miller-Nobles, Brenda Mattison, All Chapter 1-9
m m m m m m m
,THE MANAGERIAL CHAPTERS
m m
1. Introduction to Managerial Accounting
m m m
2. Job Order Costing
m m
3. Process Costingm
4. Cost-Volume-Profit Analysis m
5. Master Budgets
m
6. Flexible Budgets and Standard Cost Systems
m m m m m
7. Cost Allocation and Responsibility Accounting
m m m m
8. Short-Term Business Decisions
m m
9. Capital Investment Decisions
m m
,Chapter 1 m
Introduction to Managerial Accounting
m m m
Review Questions
m
1. Themprimarympurposemofmmanagerialmaccountingmismtomprovideminformationmtomhelpmmanagersmplan,m
direct,mcontrol,mandmmakemdecisions.
2. Financialmaccountingmandmmanagerialmaccountingmdiffermonmthemfollowingm6mdimensions:m(1)mprimarymus
ers,m(2)mpurposemofminformation,m(3)mfocusmandmtimemdimensionmofmtheminformation,m(4)mrulesmandmrestr
ictions,m(5)mscopemofminformation,mandm(6)mbehavioral.
3. Linempositionsmaremdirectlyminvolvedminmprovidingmgoodsmormservicesmtomcustomers.mStaffmpositionsms
upportmlinempositions.
4. Planningmmeansmchoosingmgoalsmandmdecidingmhowmtomachievemthem.mDirectingminvolvesmrunningmthemda
y-to-
daymoperationsmofmambusiness.mControllingmismthemprocessmofmmonitoringmoperationsmandmkeepingmthemco
mpanymonmtrack.
5. ThemfourmIMAmstandardsmofmethicalmpracticemandmamdescriptionmofmeachmfollow.
I. Competence.
Maintainmanmappropriatemlevelmofmprofessionalmleadershipmandmexpertisembymenhancingmk
nowledgemandmskills.
Performmprofessionalmdutiesminmaccordancemwithmrelevantmlaws,mregulations,mandmtechnicalms
tandards.
Providemdecisionmsupportminformationmandmrecommendationsmthatmaremaccurate,mclear,mconcise,m
andmtimely.
Recognisemandmhelpmmangemrisk.
II. Confidentiality.
Keepminformationmconfidentialmexceptmwhenmdisclosuremismauthorizedmormlegallymrequired.
Informmallmrelevantmpartiesmregardingmappropriatemusemofmconfidentialminformation.m Monitormtom
ensuremcompliance.
Refrainmfrommusingmconfidentialminformationmformunethicalmormillegalmadvantage.
III. Integrity.
Mitigatemactualmconflictsmofminterest.mRegularlymcommunicatemwithmbusinessmassociatesmtomavoidma
pparentmconflictsmofminterest.mmAdvisemallmpartiesmofmanympotentialmconflicts.
Refrainmfrommengagingminmanymconductmthatmwouldmprejudicemcarryingmoutmdutiesmethically.
, Abstainmfrommengagingminmormsupportingmanymactivitymthatmmightmdiscreditmthemprofession.
Contributemtomampositivemethicalmculturemandmplacemintegritymofmthemprofessionmabovempersonalm
interest.
5,mcont.
IV. Credibility.
Communicateminformationmfairlymandmobjectively.
Providemallmrelevantminformationmthatmcouldmreasonablymbemexpectedmtominfluencemanmintendedm
user’smunderstandingmofmthemreports,manalyses,mormrecommendations.
Reportmanymdelaysmormdeficienciesminminformation,mtimeliness,mprocessing,morminternalmcontrolsmi
nmconformancemwithmorganizationmpolicymand/ormapplicablemlaw.
Communicatemanymprofessionalmlimitationsmormothermconstraintsmthatmwouldmprecludemresponsi-
blemjudgmentmormsuccessfulmperformancemofmanmactivity.
m
6. Servicemcompaniesmsellmtime,mskills,mandmknowledge.m Examplesmofmservicemcompaniesmincludemphonemse
rvicemcompanies,mbanks,mcleaningmservicemcompanies,maccountingmfirms,mlawmfirms,mmedicalmphysicians,
mandmonlinemauctionmservices.
7. Merchandisingmcompaniesmresellmproductsmtheymbuymfrommsuppliers.mMerchandisersmkeepmanminventorymof
mproducts,mandmmanagersmaremaccountablemformthempurchasing,mstorage,mandmsalemofmthemproducts.mExamp
lesmofmmerchandisingmcompaniesmincludemtoymstores,mgrocerymstores,mandmclothingmstores.
8. Merchandisingmcompaniesmresellmproductsmtheympreviouslymboughtmfrommsuppliers,mwhereasmmanufactur
ingmcompaniesmusemlabor,mequipment,msupplies,mandmfacilitiesmtomconvertmrawmmaterialsmintomnewmfinished
mproducts.mInmcontrastmtommerchandisingmcompanies,mmanufacturingmcompaniesmhavemambroadmrangemofm
productionmactivitiesmthatmrequiremtrackingmcostsmonmthreemkindsmofminventory.
9. ThemthreeminventorymaccountsmusedmbymmanufacturingmcompaniesmaremRawmMaterialsmInventory,mWork-
in-ProcessmInventory,mandmFinishedmGoodsmInventory.
m
RawmMaterialsmInventorymincludesmmaterialsmusedmtommanufacturemamproduct.mWork-in-
ProcessmInventorymincludesmgoodsmthatmhavembeenmstartedminmthemmanufacturingmprocessmbutmaremnotmyet
mcomplete.m FinishedmGoodsmInventorymincludesmcompletedmgoodsmthatmhavemnotmyetmbeenmsold.
10. Amdirectmcostmismamcostmthatmcanmbemeasilymandmcost-
effectivelymtracedmtomamcostmobjectm(whichmismanythingmformwhichmmanagersmwantmamseparatemmeasure
mentmofmcost).mAnmindirectmcostmismamcostmthatmcannotmbemeasilymormcost-
effectivelymtracedmtomamcostmobject.
11. Themthreemmanufacturingmcostsmformammanufacturingmcompanymaremdirectmmaterials,mdirectmlabor,mandmm
anufacturingmoverhead.mDirectmmaterialsmaremmaterialsmthatmbecomemamphysicalmpartmofmamfinishedmprodu
ctmandmwhosemcostsmaremeasilymtraceablemtomthemfinishedmproduct.m Directmlabormismthemlabormcostmofmtheme
mployeesmwhomconvertmmaterialsmintomfinishedmproducts.mManufacturingmoverheadmincludesmallmmanufac
turingmcostsmexceptmdirectmmaterialsmandmdirectmlabor,msuchmasmindirectmmaterials,mindirectmlabor,mfactorym
depreciation,mfactorymrent,mandmfactorympropertymtaxes.
