Solution Manual for Managerial Accounting, 18th Edition By Ray Garrison, Eric Noreen and Peter Brewer Verified Chapter's 1 - 16 | Complete

Solution Manual for Managerial Accounting,
18th Edition
By Ray Garrison, Eric Noreen and Peter Brewer
Verified Chapter's 1 - 16 | Complete

,Table of Contents
t t




ChaptertOne:tManagerialtAccountingtandtCosttConcepts

ChaptertTwo:tJob-OrdertCosting:tCalculatingtUnittProducttCosts

ChaptertThree:tJob-OrdertCosting:tCosttFlowstandtExternaltReporting

ChaptertFour:tProcesstCosting

ChaptertFive:tCost-Volume-ProfittRelationships

ChaptertSix:tVariabletCostingtandtSegmenttReporting:tToolstfortManagement

ChaptertSeven:tActivity-BasedtCosting:tAtToolttotAidtDecisiontMaking

ChaptertEight:tMastertBudgeting

ChaptertNine:tFlexibletBudgetstandtPerformancetAnalysis

ChaptertTen:tStandardtCoststandtVariances

ChaptertEleven:tResponsibilitytAccountingtSystems

ChaptertTwelve:tStrategictPerformancetMeasurement

ChaptertThirteen:tDifferentialtAnalysis:tThetKeyttotDecisiontMaking

ChaptertFourteen:tCapitaltBudgetingtDecisions

ChaptertFifteen:tStatementtoftCashtFlows

ChaptertSixteen:tFinancialtStatementtAnalysis

,Chapter 1 t


Managerial Accounting and Cost Concepts
t t t t




Questions


1-1 Thetthreetmajorttypestoftproducttcoststi 1-4
ntatmanufacturingtcompanytaretdirecttmaterials a. Variabletcost:tThetvariabletcosttpertunittistc
,tdirecttlabor,tandtmanufacturingtoverhead. onstant,tbutttotaltvariabletcosttchangestintdi
recttproportionttotchangestintvolume.
1-2 b. Fixedtcost:tThettotaltfixedtcosttistconstanttwit
a. Directtmaterialstaretantintegraltparttoftatf hintthetrelevanttrange.tThetaveragetfixedtcos
inishedtproducttandttheirtcoststcantbetconvenie ttpertunittvariestinverselytwithtchangest intvol
ntlyttracedttotit. ume.
b. Indirecttmaterialstaretgenerallytsmalltitem c. Mixedtcost:tAtmixedtcosttcontainstbotht
stoftmaterialtsuchtastgluetandtnails.tTheytmaytbet variabletandtfixedtcosttelements.
antintegraltparttoftatfinishedtproducttbutttheirtcost
stcantbettracedttotthetproducttonlytattgreattcostto 1-5
rtinconvenience. a. Unittfixedtcoststdecreasetastthetactivitytlevelti
c. Directtlabortconsiststoftlabortcoststthatt ncreases.
cantbeteasilyttracedttotparticulartproducts. b. Unittvariabletcoststremaintconstanttastthet
Directtlabortistalsotcalledt―touchtlabor.‖ activitytleveltincreases.
d. Indirecttlabortconsiststoftthetlabortcoststo c. Totaltfixedtcoststremaintconstanttastthet
ftjanitors,tsupervisors,tmaterialsthandlers,tandtot activitytleveltincreases.
hertfactorytworkerstthattcannottbetconvenientlyt d. Totaltvariabletcoststincreasetastthetactivitytl
tracedttotparticulartproducts.tThesetlabortcostst eveltincreases.
aretincurredttotsupporttproduction,tbuttthetwork
erstinvolvedtdotnottdirectlytworktontthetproduct. 1-6
e. Manufacturingtoverheadtincludestalltman a. Costtbehavior:tCosttbehaviortrefersttotthetw
ufacturingtcoststexcepttdirecttmaterialstandtdirec aytintwhichtcoststchangetintresponsettotcha
ttlabor.tConsequently,tmanufacturingtoverheadti ngestintatmeasuretoftactivitytsuchtastsalestv
ncludestindirecttmaterialstandtindirecttlabortastw olume,tproductiontvolume,tortorderstproces
elltastothertmanufacturingtcosts. sed.
b. Relevanttrange:tThetrelevanttrangetistthetr
1-3 angetoftactivitytwithintwhichtassumptionsta
Atproducttcosttistanytcosttinvolvedtintpur bouttvariabletandtfixedtcosttbehaviortaretv
chasingtortmanufacturingtgoods.tIntthetcasetoft alid.
manufacturedtgoods,tthesetcoststconsisttoftdirec
ttmaterials,tdirecttlabor,tandtmanufacturingtoverh 1-7 Antactivitytbasetistatmeasuretoftwhat
ead.tAtperiodtcosttistatcosttthattisttakentdirectlytt evertcausestthetincurrencetoftatvariabletcost.t
otthetincometstatementtastantexpensetintthetperi Examplestoftactivitytbasestincludetunitstprodu
odtintwhichtittistincurred. ced,tunitstsold,tlettersttyped,tbedstintathospit
al,tmealstservedtintatcafe,tservicetcallstmade,t
etc.

1-8 Thetlineartassumptiontistreasonablytvalid

, tprovidingtthattthetcosttformulatistusedtonlytwith
intthetrelevanttrange.