SOLUTION MANUAL
Horngren's Accounting, 13th Edition Managerial
by Tracie Miller-Nobles, Brenda Mattison, All Chapter 1-9
,THE MANAGERIAL CHAPTERS
s s
1. Introduction to Managerial Accounting
s s s
2. Job Order Costing
s s
3. Process Costing s
4. Cost-Volume-Profit Analysis s
5. Master Budgets
s
6. Flexible Budgets and Standard Cost Systems
s s s s s
7. Cost Allocation and Responsibility Accounting
s s s s
8. Short-Term Business Decisions
s s
9. Capital Investment Decisions
s s
,Chapter 1 s
Introduction to Managerial Accounting
s s s
Review Questions
s
1. Thesprimaryspurposesofsmanagerialsaccountingsisstosprovidesinformationstoshelpsmanagerssplan,sdirec
t,scontrol,sandsmakesdecisions.
2. Financialsaccountingsandsmanagerialsaccountingsdiffersonsthesfollowings6sdimensions:s(1)sprimarysusers,s(
2)spurposesofsinformation,s(3)sfocussandstimesdimensionsofsthesinformation,s(4)srulessandsrestrictions,s(5)
sscopesofsinformation,sands(6)sbehavioral.
3. Linespositionssaresdirectlysinvolvedsinsprovidingsgoodssorsservicesstoscustomers.sStaffspositionsssupp
ortslinespositions.
4. Planningsmeansschoosingsgoalssandsdecidingshowstosachievesthem.sDirectingsinvolvessrunningsthesday-to-
daysoperationssofsasbusiness.sControllingsissthesprocesssofsmonitoringsoperationssandskeepingsthescompan
ysonstrack.
5. ThesfoursIMAsstandardssofsethicalspracticesandsasdescriptionsofseachsfollow.
I. Competence.
Maintainsansappropriateslevelsofsprofessionalsleadershipsandsexpertisesbysenhancingskno
wledgesandsskills.
Performsprofessionalsdutiessinsaccordanceswithsrelevantslaws,sregulations,sandstechnicalsstand
ards.
Providesdecisionssupportsinformationsandsrecommendationssthatsaresaccurate,sclear,sconcise,sands
timely.
Recognisesandshelpsmangesrisk.
II. Confidentiality.
Keepsinformationsconfidentialsexceptswhensdisclosuresissauthorizedsorslegallysrequired.
Informsallsrelevantspartiessregardingsappropriatesusesofsconfidentialsinformation.s Monitorstosensu
rescompliance.
Refrainsfromsusingsconfidentialsinformationsforsunethicalsorsillegalsadvantage.
III. Integrity.
Mitigatesactualsconflictssofsinterest.sRegularlyscommunicateswithsbusinesssassociatesstosavoidsappar
entsconflictssofsinterest.ssAdvisesallspartiessofsanyspotentialsconflicts.
Refrainsfromsengagingsinsanysconductsthatswouldsprejudicescarryingsoutsdutiessethically.
, Abstainsfromsengagingsinsorssupportingsanysactivitysthatsmightsdiscreditsthesprofession.
Contributestosaspositivesethicalsculturesandsplacesintegritysofsthesprofessionsabovespersonalsinter
est.
5,scont.
IV. Credibility.
Communicatesinformationsfairlysandsobjectively.
Providesallsrelevantsinformationsthatscouldsreasonablysbesexpectedstosinfluencesansintendedsuser’
ssunderstandingsofsthesreports,sanalyses,sorsrecommendations.
Reportsanysdelayssorsdeficienciessinsinformation,stimeliness,sprocessing,sorsinternalscontrolssinsco
nformanceswithsorganizationspolicysand/orsapplicableslaw.
Communicatesanysprofessionalslimitationssorsothersconstraintssthatswouldsprecludesresponsi-
sblesjudgmentsorssuccessfulsperformancesofsansactivity.
6. Servicescompaniesssellstime,sskills,sandsknowledge.s Examplessofsservicescompaniessincludesphonesservic
escompanies,sbanks,scleaningsservicescompanies,saccountingsfirms,slawsfirms,smedicalsphysicians,sandsonl
inesauctionsservices.
7. Merchandisingscompaniessresellsproductsstheysbuysfromssuppliers.sMerchandisersskeepsansinventorysofspro
ducts,sandsmanagerssaresaccountablesforsthespurchasing,sstorage,sandssalesofsthesproducts.sExamplessofsme
rchandisingscompaniessincludestoysstores,sgrocerysstores,sandsclothingsstores.
8. Merchandisingscompaniessresellsproductsstheyspreviouslysboughtsfromssuppliers,swhereassmanufacturings
companiessuseslabor,sequipment,ssupplies,sandsfacilitiesstosconvertsrawsmaterialssintosnewsfinishedsproduct
s.sInscontraststosmerchandisingscompanies,smanufacturingscompaniesshavesasbroadsrangesofsproductionsa
ctivitiessthatsrequirestrackingscostssonsthreeskindssofsinventory.
9. ThesthreesinventorysaccountssusedsbysmanufacturingscompaniessaresRawsMaterialssInventory,sWork-sin-
ProcesssInventory,sandsFinishedsGoodssInventory.
RawsMaterialssInventorysincludessmaterialssusedstosmanufacturesasproduct.sWork-in-
ProcesssInventorysincludessgoodssthatshavesbeensstartedsinsthesmanufacturingsprocesssbutsaresnotsyetscom
plete.s FinishedsGoodssInventorysincludesscompletedsgoodssthatshavesnotsyetsbeenssold.
10. Asdirectscostsissascoststhatscansbeseasilysandscost-
effectivelystracedstosascostsobjects(whichsissanythingsforswhichsmanagersswantsasseparatesmeasurementso
fscost).sAnsindirectscostsissascoststhatscannotsbeseasilysorscost-effectivelystracedstosascostsobject.
11. Thesthreesmanufacturingscostssforsasmanufacturingscompanysaresdirectsmaterials,sdirectslabor,sandsmanufa
cturingsoverhead.sDirectsmaterialssaresmaterialssthatsbecomesasphysicalspartsofsasfinishedsproductsandswho
sescostssareseasilystraceablestosthesfinishedsproduct.s Directslaborsisstheslaborscostsofsthesemployeesswhosco
nvertsmaterialssintosfinishedsproducts.sManufacturingsoverheadsincludessallsmanufacturingscostssexceptsdi
rectsmaterialssandsdirectslabor,ssuchsassindirectsmaterials,sindirectslabor,sfactorysdepreciation,sfactorysrent,s
andsfactoryspropertystaxes.
Horngren's Accounting, 13th Edition Managerial
by Tracie Miller-Nobles, Brenda Mattison, All Chapter 1-9
,THE MANAGERIAL CHAPTERS
s s
1. Introduction to Managerial Accounting
s s s
2. Job Order Costing
s s
3. Process Costing s
4. Cost-Volume-Profit Analysis s
5. Master Budgets
s
6. Flexible Budgets and Standard Cost Systems
s s s s s
7. Cost Allocation and Responsibility Accounting
s s s s
8. Short-Term Business Decisions
s s
9. Capital Investment Decisions
s s
,Chapter 1 s
Introduction to Managerial Accounting
s s s
Review Questions
s
1. Thesprimaryspurposesofsmanagerialsaccountingsisstosprovidesinformationstoshelpsmanagerssplan,sdirec
t,scontrol,sandsmakesdecisions.
2. Financialsaccountingsandsmanagerialsaccountingsdiffersonsthesfollowings6sdimensions:s(1)sprimarysusers,s(
2)spurposesofsinformation,s(3)sfocussandstimesdimensionsofsthesinformation,s(4)srulessandsrestrictions,s(5)
sscopesofsinformation,sands(6)sbehavioral.
3. Linespositionssaresdirectlysinvolvedsinsprovidingsgoodssorsservicesstoscustomers.sStaffspositionsssupp
ortslinespositions.
4. Planningsmeansschoosingsgoalssandsdecidingshowstosachievesthem.sDirectingsinvolvessrunningsthesday-to-
daysoperationssofsasbusiness.sControllingsissthesprocesssofsmonitoringsoperationssandskeepingsthescompan
ysonstrack.
5. ThesfoursIMAsstandardssofsethicalspracticesandsasdescriptionsofseachsfollow.
I. Competence.
Maintainsansappropriateslevelsofsprofessionalsleadershipsandsexpertisesbysenhancingskno
wledgesandsskills.
Performsprofessionalsdutiessinsaccordanceswithsrelevantslaws,sregulations,sandstechnicalsstand
ards.
Providesdecisionssupportsinformationsandsrecommendationssthatsaresaccurate,sclear,sconcise,sands
timely.
Recognisesandshelpsmangesrisk.
II. Confidentiality.
Keepsinformationsconfidentialsexceptswhensdisclosuresissauthorizedsorslegallysrequired.
Informsallsrelevantspartiessregardingsappropriatesusesofsconfidentialsinformation.s Monitorstosensu
rescompliance.
Refrainsfromsusingsconfidentialsinformationsforsunethicalsorsillegalsadvantage.
III. Integrity.
Mitigatesactualsconflictssofsinterest.sRegularlyscommunicateswithsbusinesssassociatesstosavoidsappar
entsconflictssofsinterest.ssAdvisesallspartiessofsanyspotentialsconflicts.
Refrainsfromsengagingsinsanysconductsthatswouldsprejudicescarryingsoutsdutiessethically.
, Abstainsfromsengagingsinsorssupportingsanysactivitysthatsmightsdiscreditsthesprofession.
Contributestosaspositivesethicalsculturesandsplacesintegritysofsthesprofessionsabovespersonalsinter
est.
5,scont.
IV. Credibility.
Communicatesinformationsfairlysandsobjectively.
Providesallsrelevantsinformationsthatscouldsreasonablysbesexpectedstosinfluencesansintendedsuser’
ssunderstandingsofsthesreports,sanalyses,sorsrecommendations.
Reportsanysdelayssorsdeficienciessinsinformation,stimeliness,sprocessing,sorsinternalscontrolssinsco
nformanceswithsorganizationspolicysand/orsapplicableslaw.
Communicatesanysprofessionalslimitationssorsothersconstraintssthatswouldsprecludesresponsi-
sblesjudgmentsorssuccessfulsperformancesofsansactivity.
6. Servicescompaniesssellstime,sskills,sandsknowledge.s Examplessofsservicescompaniessincludesphonesservic
escompanies,sbanks,scleaningsservicescompanies,saccountingsfirms,slawsfirms,smedicalsphysicians,sandsonl
inesauctionsservices.
7. Merchandisingscompaniessresellsproductsstheysbuysfromssuppliers.sMerchandisersskeepsansinventorysofspro
ducts,sandsmanagerssaresaccountablesforsthespurchasing,sstorage,sandssalesofsthesproducts.sExamplessofsme
rchandisingscompaniessincludestoysstores,sgrocerysstores,sandsclothingsstores.
8. Merchandisingscompaniessresellsproductsstheyspreviouslysboughtsfromssuppliers,swhereassmanufacturings
companiessuseslabor,sequipment,ssupplies,sandsfacilitiesstosconvertsrawsmaterialssintosnewsfinishedsproduct
s.sInscontraststosmerchandisingscompanies,smanufacturingscompaniesshavesasbroadsrangesofsproductionsa
ctivitiessthatsrequirestrackingscostssonsthreeskindssofsinventory.
9. ThesthreesinventorysaccountssusedsbysmanufacturingscompaniessaresRawsMaterialssInventory,sWork-sin-
ProcesssInventory,sandsFinishedsGoodssInventory.
RawsMaterialssInventorysincludessmaterialssusedstosmanufacturesasproduct.sWork-in-
ProcesssInventorysincludessgoodssthatshavesbeensstartedsinsthesmanufacturingsprocesssbutsaresnotsyetscom
plete.s FinishedsGoodssInventorysincludesscompletedsgoodssthatshavesnotsyetsbeenssold.
10. Asdirectscostsissascoststhatscansbeseasilysandscost-
effectivelystracedstosascostsobjects(whichsissanythingsforswhichsmanagersswantsasseparatesmeasurementso
fscost).sAnsindirectscostsissascoststhatscannotsbeseasilysorscost-effectivelystracedstosascostsobject.
11. Thesthreesmanufacturingscostssforsasmanufacturingscompanysaresdirectsmaterials,sdirectslabor,sandsmanufa
cturingsoverhead.sDirectsmaterialssaresmaterialssthatsbecomesasphysicalspartsofsasfinishedsproductsandswho
sescostssareseasilystraceablestosthesfinishedsproduct.s Directslaborsisstheslaborscostsofsthesemployeesswhosco
nvertsmaterialssintosfinishedsproducts.sManufacturingsoverheadsincludessallsmanufacturingscostssexceptsdi
rectsmaterialssandsdirectslabor,ssuchsassindirectsmaterials,sindirectslabor,sfactorysdepreciation,sfactorysrent,s
andsfactoryspropertystaxes.
