Solution Manual for Managerial
Accounting,
18th Edition
By Ray Garrison, Eric Noreen and
Peter Brewer
Ve
rifi
ed
Ch
ap
ter
's
1-
16
|
Co
m
ple
te
So
lut
, ion Manual for Managerial Accounting,
18th Edition
By Ray Garrison, Eric Noreen and Peter Brewer
Verified Chapter's 1 - 16 | Complete
Ta
bl
e 45
of 4
C
5
on
te
nt
s
Chapt
er45O
ne:45
Mana
gerial
45Acc
ounti
ng45a
nd45C
ost45
,Concepts
Chapter45Two:45Job-Order45Costing:45Calculating45Unit45Product45Costs
Chapter45Three:45Job-Order45Costing:45Cost45Flows45and45External45Reporting
Chapter45Four:45Process45Costing
Chapter45Five:45Cost-Volume-Profit45Relationships
Chapter45Six:45Variable45Costing45and45Segment45Reporting:45Tools45for45Management
Chapter45Seven:45Activity-Based45Costing:45A45Tool45to45Aid45Decision45Making
Chapter45Eight:45Master45Budgeting
Chapter45Nine:45Flexible45Budgets45and45Performance45Analysis
Chapter45Ten:45Standard45Costs45and45Variances
Chapter45Eleven:45Responsibility45Accounting45Systems
Chapter45Twelve:45Strategic45Performance45Measurement
Chapter45Thirteen:45Differential45Analysis:45The45Key45to45Decision45Making
Chapter45Fourteen:45Capital45Budgeting45Decisions
Chapter45Fifteen:45Statement45of45Cash45Flows
Chapter45Sixteen:45Financial45Statement45Analysis
, Chapter 1 45
Managerial Accounting and Cost Concepts
45 45 45 45
Questions
1-1 The45three45major45types45of45product period45cost45is45a45cost45that45is45taken45direct
ly45to45the45income45statement45as45an45expens
45costs45in45a45manufacturing45company45are
45direct45materials,45direct45labor,45and45man
e45in45the45period45in45which45it45is45incurred.
ufacturing45overhead.
1-2
a. Direct45materials45are45an45integral45pa
rt45of45a45finished45product45and45their45costs
45can45be45conveniently45traced45to45it.
b. Indirect45materials45are45generally45smal
l45items45of45material45such45as45glue45and45n
ails.45They45may45be45an45integral45part45of45a4
5finished45product45but45their45costs45can45be45
traced45to45the45product45only45at45great45cost
45or45inconvenience.
c. Direct45labor45consists45of45labor45cost
s45that45can45be45easily45traced45to45particu
lar45products.
Direct45labor45is45also45called45―touch45labor.‖
d. Indirect45labor45consists45of45the45labor
45costs45of45janitors,45supervisors,45materials45
handlers,45and45other45factory45workers45that
45cannot45be45conveniently45traced45to45partic
ular45products.45These45labor45costs45are45inc
urred45to45support45production,45but45the45w
orkers45involved45do45not45directly45work45on
45the45product.
e. Manufacturing45overhead45includes45all4
5manufacturing45costs45except45direct45materia
ls45and45direct45labor.45Consequently,45manufa
cturing45overhead45includes45indirect45materials
45and45indirect45labor45as45well45as45other45ma
nufacturing45costs.
1-3
A45product45cost45is45any45cost45involv
ed45in45purchasing45or45manufacturing45goods.
45In45the45case45of45manufactured45goods,45th
ese45costs45consist45of45direct45materials,45dire
ct45labor,45and45manufacturing45overhead.45A45
Accounting,
18th Edition
By Ray Garrison, Eric Noreen and
Peter Brewer
Ve
rifi
ed
Ch
ap
ter
's
1-
16
|
Co
m
ple
te
So
lut
, ion Manual for Managerial Accounting,
18th Edition
By Ray Garrison, Eric Noreen and Peter Brewer
Verified Chapter's 1 - 16 | Complete
Ta
bl
e 45
of 4
C
5
on
te
nt
s
Chapt
er45O
ne:45
Mana
gerial
45Acc
ounti
ng45a
nd45C
ost45
,Concepts
Chapter45Two:45Job-Order45Costing:45Calculating45Unit45Product45Costs
Chapter45Three:45Job-Order45Costing:45Cost45Flows45and45External45Reporting
Chapter45Four:45Process45Costing
Chapter45Five:45Cost-Volume-Profit45Relationships
Chapter45Six:45Variable45Costing45and45Segment45Reporting:45Tools45for45Management
Chapter45Seven:45Activity-Based45Costing:45A45Tool45to45Aid45Decision45Making
Chapter45Eight:45Master45Budgeting
Chapter45Nine:45Flexible45Budgets45and45Performance45Analysis
Chapter45Ten:45Standard45Costs45and45Variances
Chapter45Eleven:45Responsibility45Accounting45Systems
Chapter45Twelve:45Strategic45Performance45Measurement
Chapter45Thirteen:45Differential45Analysis:45The45Key45to45Decision45Making
Chapter45Fourteen:45Capital45Budgeting45Decisions
Chapter45Fifteen:45Statement45of45Cash45Flows
Chapter45Sixteen:45Financial45Statement45Analysis
, Chapter 1 45
Managerial Accounting and Cost Concepts
45 45 45 45
Questions
1-1 The45three45major45types45of45product period45cost45is45a45cost45that45is45taken45direct
ly45to45the45income45statement45as45an45expens
45costs45in45a45manufacturing45company45are
45direct45materials,45direct45labor,45and45man
e45in45the45period45in45which45it45is45incurred.
ufacturing45overhead.
1-2
a. Direct45materials45are45an45integral45pa
rt45of45a45finished45product45and45their45costs
45can45be45conveniently45traced45to45it.
b. Indirect45materials45are45generally45smal
l45items45of45material45such45as45glue45and45n
ails.45They45may45be45an45integral45part45of45a4
5finished45product45but45their45costs45can45be45
traced45to45the45product45only45at45great45cost
45or45inconvenience.
c. Direct45labor45consists45of45labor45cost
s45that45can45be45easily45traced45to45particu
lar45products.
Direct45labor45is45also45called45―touch45labor.‖
d. Indirect45labor45consists45of45the45labor
45costs45of45janitors,45supervisors,45materials45
handlers,45and45other45factory45workers45that
45cannot45be45conveniently45traced45to45partic
ular45products.45These45labor45costs45are45inc
urred45to45support45production,45but45the45w
orkers45involved45do45not45directly45work45on
45the45product.
e. Manufacturing45overhead45includes45all4
5manufacturing45costs45except45direct45materia
ls45and45direct45labor.45Consequently,45manufa
cturing45overhead45includes45indirect45materials
45and45indirect45labor45as45well45as45other45ma
nufacturing45costs.
1-3
A45product45cost45is45any45cost45involv
ed45in45purchasing45or45manufacturing45goods.
45In45the45case45of45manufactured45goods,45th
ese45costs45consist45of45direct45materials,45dire
ct45labor,45and45manufacturing45overhead.45A45
