Solutions Manual for Managerial
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Accounting:
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Creating Value in a Dynamic Business
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Environment, 13th Edition by Hilton
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,Chapter aa1: aaThe aaChanging aaRole aaof aaManagerial aaAccounting aain aaa aaDynamic aaBusiness
EnvironmentaChapter aa2: aaBasic aaCost aaManagement aaConcepts
aa
Chapter aa3: aaProduct aaCosting aaand aaCost aaAccumulation aain aaa aaBatch aaProduction
aa EnvironmentaChapter aa4: aaProcess aaCosting aaand aa Hybrid aaProduct-Costing aa Systems
Chapter aa5: aaActivity-Based aaCosting aaand aaManagement
Chapter aa6: aaActivity aaAnalysis, aaCost aaBehavior, aaand aaCost
aa EstimationaChapter aa7: aaCost-Volume-Profit aaAnalysis
Chapter aa8: aaVariable aaCosting aaand aathe aaMeasurement aaof aaESG aaand aaQuality
aa CostsaChapter aa9: aaFinancial aaPlanning aaand aaAnalysis: aaThe aaMaster aaBudget
Chapter aa10: aaStandard aaCosting aaand aaAnalysis aaof aaDirect aaCosts
Chapter aa11: aaFlexible aaBudgeting aaand aathe aaManagement aaof aaOverhead aaand aaSupport
aa Activity aaCostsaChapter aa12: aaResponsibility aaAccounting aaand aathe aaBalanced aaScorecard
Chapter aa13: aaInvestment aaCenters aaand aaTransfer aaPricing
aa Chapter aa14: aaDecision aaMaking: aaRelevant aaCosts aaand
aa Benefits
Chapter aa15: aaTarget aaCosting aaand aaCost aaAnalysis aafor aaPricing
aa DecisionsaChapter aa16: aaCapital aaExpenditure aaDecisions
Chapter aa17: aaAllocation aaof aaSupport aaActivity aaCosts aaand aaJoint aaCosts
Appendix aaI: aaThe aaSarbanes-Oxley aaAct, aaInternal aaControls, aaand aaManagement
aa AccountingaAppendix aaII: aaCompound aaInterest aaand aa the aa Concept aaof aaPresent aaValue
Appendix aaIII: aaInventory aaManagement
,CHAPTER 1 aa
The Crucial Role of Managerial Accounting in a
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Dynamic Business Environment
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FOCUS ON ETHICS (Located before the Chapter Summary in the text.)
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The focus-on-ethics inset for Chapter 1 is the IMA Statement of Ethical Professional
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Practice. Instructors can use this list of ethical principles and standards to lead
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a class discussion. The discussion can also range to consideration of how
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these standards may have been violated by accountants and managers involved in
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the various
aa aa ethical scandals uncovered over the past several years. It is also
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useful to discuss the pros and cons of the procedures that IMA suggests for its
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members when they believe they know about ethical lapses in their organizations.
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ANSWERS TO REVIEW QUESTIONS aa aa aa
1-1 The explosion in e-commerce will affect managers in significant ways.
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aaOne effect will be a drastic reduction in paper
aa work.aa Millions of aa aa aa aa aa aa aa aa aa
aatransactions between businesses are now being conducted electronically
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with no hard-copy documentation. Along with this method of communicating
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for business transactions comes the very significant issue of information
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security. Businesses need to find ways to protect confidential information in
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their own computers, in cloud computing data centers, and while moving
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aaacross the internet, while aaat the same time sharing
aa the aa aa aa aa aa aa aa
aainformation necessary to complete transactions. Another effect of e-commerce is
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aathe dramatically increased speed with which business transactions can be
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conducted. In addition, there will be dramatic changes in the way managerial
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accounting procedures are carried out, one example being cloud-based
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budgeting, which is the enterprise-wide and electronic completion of a
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company’s budgeting process using cloud-based software and data storage.
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, 1-2 Plausible a a goals a a for a a the a a organizations a a listed aa are a a as a a follows:
(a) Amazon.com: (1) To achieve and maintain profitability, and (2) to grow
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on-line sales of their many products. Amazon is also famous (infamous)
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for wanting 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
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to have resources available to meet any disaster that may occur, and
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(2) to provide assistance to people who are victims of a disaster anywhere
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in the world on short notice.
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(c) General Motors: (1) To earn income sufficient to provide a good return
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on the investment of the company's stockholders, and (2) to provide the
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highest-quality product possible.
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(d) Wal-Mart: (1) To penetrate the retail market in virtually every location in the
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United States, and (2) to grow over time in terms of number of retail
aa aa aa aa aa aa aa aa aa aa aa aa aa aa
locations, total
aa assets, and earnings. Also, to be competitive with
aa aa aa aa aa aa aa aa aa
Amazon in the e-retail space.
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(e) City of Seattle: (1) To maintain an urban environment as free of
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pollution as possible, and (2) to provide public safety, police, and fire
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protection to the city's citizens.
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(f) Hertz: (1) To be a recognizable household name associated with rental
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car services, and (2) to provide reliable and economical transportation services
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to the company's customers.
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1-3 The a a four a a basic a a management aa activities a a are a a listed aa and a a defined a a as a a follows:
(a) Decision a a making: a a Choosing a a among a a the a a available a a alternatives.
(b) Planning: Developing a detailed financial aa aa aa aa aa and operational aa
description ofanticipated operations.
aa aa a aa
(c) Directing aa operations: a a Running a a the aa organization a a on a a a aa day-to-day aa basis.
(d) Controlling: Ensuring that the organization aa aa aa aa aa operates in the intended aa aa aa
manner andachieves its goals.
aa aa a aa aa
aa aa aa
Accounting:
aa
Creating Value in a Dynamic Business
aa aa aa aa aa
Environment, 13th Edition by Hilton
a aa aa aa aa
,Chapter aa1: aaThe aaChanging aaRole aaof aaManagerial aaAccounting aain aaa aaDynamic aaBusiness
EnvironmentaChapter aa2: aaBasic aaCost aaManagement aaConcepts
aa
Chapter aa3: aaProduct aaCosting aaand aaCost aaAccumulation aain aaa aaBatch aaProduction
aa EnvironmentaChapter aa4: aaProcess aaCosting aaand aa Hybrid aaProduct-Costing aa Systems
Chapter aa5: aaActivity-Based aaCosting aaand aaManagement
Chapter aa6: aaActivity aaAnalysis, aaCost aaBehavior, aaand aaCost
aa EstimationaChapter aa7: aaCost-Volume-Profit aaAnalysis
Chapter aa8: aaVariable aaCosting aaand aathe aaMeasurement aaof aaESG aaand aaQuality
aa CostsaChapter aa9: aaFinancial aaPlanning aaand aaAnalysis: aaThe aaMaster aaBudget
Chapter aa10: aaStandard aaCosting aaand aaAnalysis aaof aaDirect aaCosts
Chapter aa11: aaFlexible aaBudgeting aaand aathe aaManagement aaof aaOverhead aaand aaSupport
aa Activity aaCostsaChapter aa12: aaResponsibility aaAccounting aaand aathe aaBalanced aaScorecard
Chapter aa13: aaInvestment aaCenters aaand aaTransfer aaPricing
aa Chapter aa14: aaDecision aaMaking: aaRelevant aaCosts aaand
aa Benefits
Chapter aa15: aaTarget aaCosting aaand aaCost aaAnalysis aafor aaPricing
aa DecisionsaChapter aa16: aaCapital aaExpenditure aaDecisions
Chapter aa17: aaAllocation aaof aaSupport aaActivity aaCosts aaand aaJoint aaCosts
Appendix aaI: aaThe aaSarbanes-Oxley aaAct, aaInternal aaControls, aaand aaManagement
aa AccountingaAppendix aaII: aaCompound aaInterest aaand aa the aa Concept aaof aaPresent aaValue
Appendix aaIII: aaInventory aaManagement
,CHAPTER 1 aa
The Crucial Role of Managerial Accounting in a
aa aa aa aa aa aa aa
Dynamic Business Environment
aa aa aa
FOCUS ON ETHICS (Located before the Chapter Summary in the text.)
aa aa aa aa aa aa aa aa aa aa
The focus-on-ethics inset for Chapter 1 is the IMA Statement of Ethical Professional
aa aa aa aa aa aa aa aa aa aa aa aa
Practice. Instructors can use this list of ethical principles and standards to lead
aa aa aa aa aa aa aa aa a a a a aa aa aa
a class discussion. The discussion can also range to consideration of how
aa aa aa aa aa aa aa aa aa aa aa aa
these standards may have been violated by accountants and managers involved in
aa aa aa aa aa aa aa aa aa aa aa aa
the various
aa aa ethical scandals uncovered over the past several years. It is also
a a aa aa aa aa aa aa aa aa aa aa
useful to discuss the pros and cons of the procedures that IMA suggests for its
aa aa aa aa aa aa aa aa aa aa aa aa aa aa aa
members when they believe they know about ethical lapses in their organizations.
aa aa aa aa aa aa aa aa aa aa aa aa
ANSWERS TO REVIEW QUESTIONS aa aa aa
1-1 The explosion in e-commerce will affect managers in significant ways.
aa aa aa aa aa aa aa aa aa
aaOne effect will be a drastic reduction in paper
aa work.aa Millions of aa aa aa aa aa aa aa aa aa
aatransactions between businesses are now being conducted electronically
aa aa aa aa aa aa aa
with no hard-copy documentation. Along with this method of communicating
aa aa aa aa aa aa a aa aa aa
for business transactions comes the very significant issue of information
aa aa aa aa aa aa aa aa aa aa
security. Businesses need to find ways to protect confidential information in
aa aa aa aa aa aa aa aa aa aa aa
their own computers, in cloud computing data centers, and while moving
aa aa aa aa aa aa aa aa aa aa aa
aaacross the internet, while aaat the same time sharing
aa the aa aa aa aa aa aa aa
aainformation necessary to complete transactions. Another effect of e-commerce is
aa aa aa aa aa aa aa aa aa
aathe dramatically increased speed with which business transactions can be
aa aa aa aa aa aa aa aa aa
conducted. In addition, there will be dramatic changes in the way managerial
aa aa aa aa aa aa aa aa aa aa aa aa
accounting procedures are carried out, one example being cloud-based
aa aa aa aa aa aa aa aa aa
budgeting, which is the enterprise-wide and electronic completion of a
aa aa aa aa aa aa aa a aa aa
company’s budgeting process using cloud-based software and data storage.
aa aa aa aa aa aa aa aa aa
, 1-2 Plausible a a goals a a for a a the a a organizations a a listed aa are a a as a a follows:
(a) Amazon.com: (1) To achieve and maintain profitability, and (2) to grow
aa aa aa aa aa aa aa aa aa aa
on-line sales of their many products. Amazon is also famous (infamous)
aa aa aa aa aa aa aa aa aa aa aa
for wanting to have every product in the world on its site.
aa aa aa aa aa aa aa aa aa aa aa aa
(b) American Red Cross: (1) To raise funds from the general public sufficient
aa aa aa aa aa aa aa aa aa aa aa
to have resources available to meet any disaster that may occur, and
aa aa aa aa aa aa aa aa aa aa aa aa
(2) to provide assistance to people who are victims of a disaster anywhere
aa aa aa aa aa aa aa aa aa aa aa aa aa
in the world on short notice.
aa aa aa aa aa aa
(c) General Motors: (1) To earn income sufficient to provide a good return
aa aa aa aa aa aa aa aa aa aa aa
on the investment of the company's stockholders, and (2) to provide the
aa aa aa aa aa aa aa aa aa aa aa aa
highest-quality product possible.
aa aa aa
(d) Wal-Mart: (1) To penetrate the retail market in virtually every location in the
aa aa aa aa aa aa aa aa aa aa aa aa
United States, and (2) to grow over time in terms of number of retail
aa aa aa aa aa aa aa aa aa aa aa aa aa aa
locations, total
aa assets, and earnings. Also, to be competitive with
aa aa aa aa aa aa aa aa aa
Amazon in the e-retail space.
aa aa aa aa aa
(e) City of Seattle: (1) To maintain an urban environment as free of
aa aa aa aa aa aa aa aa aa aa aa
pollution as possible, and (2) to provide public safety, police, and fire
aa aa aa aa aa aa aa aa aa aa aa aa
protection to the city's citizens.
aa aa aa aa aa
(f) Hertz: (1) To be a recognizable household name associated with rental
aa aa aa aa aa aa aa aa aa aa
car services, and (2) to provide reliable and economical transportation services
aa aa aa aa aa aa aa aa aa aa aa
to the company's customers.
aa aa aa aa
1-3 The a a four a a basic a a management aa activities a a are a a listed aa and a a defined a a as a a follows:
(a) Decision a a making: a a Choosing a a among a a the a a available a a alternatives.
(b) Planning: Developing a detailed financial aa aa aa aa aa and operational aa
description ofanticipated operations.
aa aa a aa
(c) Directing aa operations: a a Running a a the aa organization a a on a a a aa day-to-day aa basis.
(d) Controlling: Ensuring that the organization aa aa aa aa aa operates in the intended aa aa aa
manner andachieves its goals.
aa aa a aa aa
