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Solutions Manual
Managerial Accounting: Creating Value in a Dynamic
Business Environment, 13th Edition by Hilton
Chapters 1 - 17 Complete

,TABLE OF CONTENTS SJ SJ




Chapter 1: The Changing Role of Managerial Accounting in a Dynamic Business Envir
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onmentChapter 2: Basic Cost Management Concepts
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Chapter 3: Product Costing and Cost Accumulation in a Batch Production Environmen
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tChapter 4: Process Costing and Hybrid Product-Costing Systems
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Chapter 5: Activity-Based Costing and Management
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Chapter 6: Activity Analysis, Cost Behavior, and Cost Esti
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mationChapter 7: Cost-Volume-Profit Analysis
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Chapter 8: Variable Costing and the Measurement of ESG and Quality Cost
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sChapter 9: Financial Planning and Analysis: The Master Budget
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Chapter 10: Standard Costing and Analysis of Direct Costs
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Chapter 11: Flexible Budgeting and the Management of Overhead and Support Activit
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y CostsChapter 12: Responsibility Accounting and the Balanced Scorecard
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Chapter 13: Investment Centers and Transfer Pricing C
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hapter 14: Decision Making: Relevant Costs and Benefit
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s

Chapter 15: Target Costing and Cost Analysis for Pricing Deci
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sionsChapter 16: Capital Expenditure Decisions
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Chapter 17: Allocation of Support Activity Costs and Joint Costs
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Appendix I: The Sarbanes- SJ SJ SJ




Oxley Act, Internal Controls, and Management AccountingAppendix II: Compound Int
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erest and the Concept of Present Value
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Appendix III: Inventory Management SJ SJ SJ

,CHAPTER 1 SJ




The Crucial Role of Managerial Accounting in a
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Dynamic Business Environment SJ SJ




FOCUS ON ETHICS (Located before the Chapter Summary in the text.)
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The focus-on-
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ethics inset for Chapter 1 is the IMA Statement of Ethical Professional Practice. Instructors ca
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n use this list of ethical principles and standards to lead a class discussion. The discuss
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ion can also range to consideration of how these standards may have been violated b
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y accountants and managers involved in the various ethical scandals uncovered over the
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past several years. It is also useful to discuss the pros and cons of the procedures that IM
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A suggests for its members when they believe they know about ethical lapses in their org
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anizations.

ANSWERS TO REVIEW QUESTIONS SJ SJ SJ




1-1 The explosion in e- SJ S J S J




commerce will affect managers in significant ways. One effect will be a drastic re
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duction in paper work. Millions of transactions between businesses are now being
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conducted electronically with no hard-
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copy documentation. Along withthis method of communicating for business tra
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nsactions comes the very significant issue of information security. Businesses nee
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d to find ways to protect confidential information in their own computers, in clo
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ud computing data centers, and while moving across the internet, while at the
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Jsame time sharing the information necessary to complete transactions. Another ef
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fect of e- SJ SJ




commerce is the dramatically increased speed with which business transactions c
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an be conducted. In addition, there will be dramatic changes in the way manageria
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l accounting procedures are carried out, one example being cloud-
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based budgeting, which is the enterprise- SJ SJ SJ SJ SJ




wide and electroniccompletion of a company’s budgeting process using cloud-
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based software and data storage. SJ SJ SJ SJ

, 1-2 Plausible goals for the organizations listed are as follows:
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(a) Amazon.com: (1) To achieve and maintain profitability, and (2) to grow on SJ SJ SJ SJ SJ SJ SJ SJ SJ SJ SJ




-
line sales of their many products. Amazon is also famous (infamous) for wanti
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ng to have every product in the world on its site.
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(b) American Red Cross: (1) To raise funds from the general public sufficient to ha
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ve resources available to meet any disaster that may occur, and (2) to prov
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ide assistance to people who are victims of a disaster anywhere in the world on shor
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t notice.
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(c) General Motors: (1) To earn income sufficient to provide a good return on
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the investment of the company's stockholders, and (2) to provide the highest-
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quality product possible. SJ SJ




(d) Wal-
Mart: (1) To penetrate the retail market in virtually every location in the United Sta
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tes, and (2) to grow over time in terms of number of retail locations, total assets,
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and earnings. Also, to be competitive with Amazon in the e-retail space.
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(e) City of Seattle: (1) To maintain an urban environment as free of pollution
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as possible, and (2) to provide public safety, police, and fire protection to the ci
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ty's citizens.SJ




(f) Hertz: (1) To be a recognizable household name associated with rental car
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services, and (2) to provide reliable and economical transportation services to the c
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ompany's customers. SJ




1-3 The four basic management activities are listed and defined as follows:
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(a) Decision making: Choosing among the available alternatives.
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(b) Planning: Developing a detailed financial and operational descrip S J S J S J S J S J S J S J




tion ofanticipated operations.
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(c) Directing operations: Running the organization on a day-to-day basis.
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(d) Controlling: Ensuring that the organization operates in the intended man S J S J S J S J S J S J S J S J S J




ner andachieves its goals.
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