Solution Manual for Managerial
Accounting,
18th Edition
By Ray Garrison, Eric Noreen and Peter
Brewer Verified Chapter's 1 - 16 |
Complete
,Table of Contents 8t 8t
Chapter 8tOne: 8tManagerial 8tAccounting 8tand 8tCost
8t Concepts 8t Chapter 8tTwo: 8tJob-Order 8tCosting:
8t Calculating 8tUnit 8tProduct 8tCosts
Chapter 8tThree: 8tJob-Order 8tCosting: 8tCost 8tFlows 8tand 8tExternal
8t Reporting 8t Chapter 8tFour: 8tProcess 8tCosting
Chapter 8tFive: 8tCost-Volume-Profit 8tRelationships
Chapter 8tSix: 8tVariable 8tCosting 8tand 8tSegment 8tReporting: 8tTools
8t for 8tManagement 8t Chapter 8tSeven: 8tActivity-Based 8tCosting: 8tA
8t Tool 8tto 8tAid 8tDecision 8tMaking 8 t Chapter 8tEight: 8tMaster
8t Budgeting
Chapter 8tNine: 8tFlexible 8tBudgets 8tand
8t Performance 8tAnalysis 8t Chapter 8tTen: 8tStandard
8t Costs 8tand 8tVariances
Chapter 8tEleven: 8tResponsibility 8tAccounting
8t Systems 8t Chapter 8tTwelve: 8tStrategic
8t Performance 8tMeasurement
Chapter 8tThirteen: 8tDifferential 8tAnalysis: 8tThe 8tKey 8tto
Decision 8tMaking
8t 8t Chapter 8tFourteen: 8tCapital 8tBudgeting
8t Decisions 8tChapter 8tFifteen: 8tStatement 8tof 8tCash
Flows 8tChapter 8tSixteen: 8tFinancial
8t Statement 8tAnalysis
, Chapter 1 8t
Managerial Accounting and Cost 8t 8t 8t 8t
Concepts
8t
Questions
8tconsist 8tof 8 t direct 8tmaterials, 8tdirect
1-1 The 8tthree 8tmajor 8ttypes 8tof
8tlabor, 8tand 8tmanufacturing 8 t overhead. 8tA
8tproduct 8tcosts 8 t in 8ta 8tmanufacturing
8tperiod 8tcost 8tis 8ta 8tcost 8tthat 8tis 8ttaken
8tcompany 8tare 8tdirect 8tmaterials,
8 t directly 8tto 8 t the 8 t income 8 t statement
8tdirect 8tlabor, 8tand 8tmanufacturing
8 t as 8 t an 8 t expense 8tin 8tthe 8tperiod 8tin
8 t overhead.
8twhich 8tit 8tis 8tincurred.
1-2
a. Direct 8tmaterials 8tare 8tan
8tintegral 8tpart 8tof 8ta 8 t finished
8tproduct 8tand 8ttheir 8tcosts 8tcan 8tbe
8 t conveniently 8ttraced 8tto 8tit.
b. Indirect 8tmaterials 8tare 8tgenerally
8tsmall 8 t items 8tof 8tmaterial 8tsuch 8tas
8tglue 8tand 8tnails. 8tThey 8 t may 8tbe 8tan
8tintegral 8tpart 8tof 8ta 8tfinished 8tproduct
8tbut 8ttheir 8tcosts 8tcan 8tbe 8ttraced 8tto
8tthe 8tproduct 8tonly 8tat 8 t great 8tcost 8tor
8tinconvenience.
c. Direct 8tlabor 8tconsists 8tof
8tlabor 8tcosts 8tthat 8 t can 8tbe
8teasily 8ttraced 8tto 8tparticular
8tproducts.
Direct 8tlabor 8tis 8talso 8tcalled 8t―touch
8tlabor.‖
d. Indirect 8tlabor 8tconsists 8tof 8tthe
8tlabor 8tcosts 8 t of 8tjanitors, 8tsupervisors,
8tmaterials 8thandlers, 8tand 8 t other
8tfactory 8tworkers 8tthat 8tcannot 8tbe
8tconveniently 8ttraced 8tto 8tparticular
8tproducts. 8tThese 8tlabor 8tcosts 8 t are
8tincurred 8tto 8tsupport 8 t production,
8tbut 8tthe 8tworkers 8tinvolved 8tdo 8tnot
8 t directly 8twork 8ton 8tthe 8tproduct.
e. Manufacturing 8 t overhead
8 t includes 8tall 8 t manufacturing 8tcosts
8texcept 8tdirect 8tmaterials 8tand 8 t direct
8tlabor. 8tConsequently, 8t manufacturing
8toverhead 8tincludes 8tindirect 8tmaterials
8tand 8tindirect 8 t labor 8tas 8twell 8tas 8tother
8tmanufacturing 8tcosts.
1-3 A 8tproduct 8tcost 8tis 8tany 8tcost
8tinvolved 8tin 8tpurchasing 8tor
8tmanufacturing 8tgoods. 8tIn 8tthe 8tcase
8 t of 8tmanufactured 8tgoods, 8tthese 8tcosts
, 1-4
a. Variable 8tcost: 8tThe 8tvariable
8tcost 8tper 8tunit 8tis 8tconstant,
8tbut 8ttotal 8tvariable 8tcost
8tchanges 8tin 8tdirect 8tproportion
8tto 8tchanges 8tin 8tvolume.
b. Fixed 8tcost: 8tThe 8ttotal 8tfixed 8tcost
8tis 8tconstant 8 t within 8tthe
8trelevant 8trange. 8tThe 8taverage
8tfixed 8 t cost 8tper 8tunit 8tvaries
8tinversely 8twith 8tchanges 8tin
8tvolume.
c. Mixed 8tcost: 8tA 8tmixed 8tcost
8tcontains 8tboth 8 t variable
8tand 8tfixed 8tcost 8telements.
1-5
a. Unit 8tfixed 8tcosts 8tdecrease
8tas 8tthe 8tactivity 8tlevel
8tincreases.
b. Unit 8tvariable 8tcosts 8tremain
8tconstant 8tas 8tthe 8 t activity
8tlevel 8tincreases.
c. Total 8tfixed 8tcosts 8tremain
8tconstant 8tas 8tthe 8 t activity
8tlevel 8tincreases.
d. Total 8tvariable 8tcosts 8tincrease
8tas 8tthe 8tactivity 8tlevel
8tincreases.
1-6
a. Cost 8tbehavior: 8tCost 8tbehavior
8trefers 8 t to 8tthe 8tway 8tin 8twhich
8tcosts 8tchange 8tin 8tresponse 8tto
8tchanges 8tin 8ta 8tmeasure 8tof
8tactivity 8tsuch 8tas 8 t sales
8tvolume, 8tproduction 8tvolume,
8tor 8torders 8tprocessed.
b. Relevant 8trange: 8tThe 8trelevant
8trange 8 t is 8tthe 8 t range 8tof
8tactivity 8twithin 8twhich
8tassumptions 8 t about 8tvariable
8tand 8 t fixed 8tcost 8tbehavior 8tare
8 t valid.
1-7 An 8 t activity 8 t base 8 t is 8 t a
8 t measure 8tof 8 t whatever 8tcauses
8tthe 8tincurrence 8tof 8ta 8tvariable
8 t cost. 8tExamples 8tof 8tactivity
8tbases 8tinclude 8tunits 8 t produced,
8tunits 8tsold, 8tletters 8ttyped, 8tbeds
8tin 8ta 8 t hospital, 8tmeals 8tserved
8tin 8ta 8tcafe, 8tservice 8tcalls 8tmade,
8tetc.
1-8 The 8t linear 8t assumption 8t is
8t reasonably
Accounting,
18th Edition
By Ray Garrison, Eric Noreen and Peter
Brewer Verified Chapter's 1 - 16 |
Complete
,Table of Contents 8t 8t
Chapter 8tOne: 8tManagerial 8tAccounting 8tand 8tCost
8t Concepts 8t Chapter 8tTwo: 8tJob-Order 8tCosting:
8t Calculating 8tUnit 8tProduct 8tCosts
Chapter 8tThree: 8tJob-Order 8tCosting: 8tCost 8tFlows 8tand 8tExternal
8t Reporting 8t Chapter 8tFour: 8tProcess 8tCosting
Chapter 8tFive: 8tCost-Volume-Profit 8tRelationships
Chapter 8tSix: 8tVariable 8tCosting 8tand 8tSegment 8tReporting: 8tTools
8t for 8tManagement 8t Chapter 8tSeven: 8tActivity-Based 8tCosting: 8tA
8t Tool 8tto 8tAid 8tDecision 8tMaking 8 t Chapter 8tEight: 8tMaster
8t Budgeting
Chapter 8tNine: 8tFlexible 8tBudgets 8tand
8t Performance 8tAnalysis 8t Chapter 8tTen: 8tStandard
8t Costs 8tand 8tVariances
Chapter 8tEleven: 8tResponsibility 8tAccounting
8t Systems 8t Chapter 8tTwelve: 8tStrategic
8t Performance 8tMeasurement
Chapter 8tThirteen: 8tDifferential 8tAnalysis: 8tThe 8tKey 8tto
Decision 8tMaking
8t 8t Chapter 8tFourteen: 8tCapital 8tBudgeting
8t Decisions 8tChapter 8tFifteen: 8tStatement 8tof 8tCash
Flows 8tChapter 8tSixteen: 8tFinancial
8t Statement 8tAnalysis
, Chapter 1 8t
Managerial Accounting and Cost 8t 8t 8t 8t
Concepts
8t
Questions
8tconsist 8tof 8 t direct 8tmaterials, 8tdirect
1-1 The 8tthree 8tmajor 8ttypes 8tof
8tlabor, 8tand 8tmanufacturing 8 t overhead. 8tA
8tproduct 8tcosts 8 t in 8ta 8tmanufacturing
8tperiod 8tcost 8tis 8ta 8tcost 8tthat 8tis 8ttaken
8tcompany 8tare 8tdirect 8tmaterials,
8 t directly 8tto 8 t the 8 t income 8 t statement
8tdirect 8tlabor, 8tand 8tmanufacturing
8 t as 8 t an 8 t expense 8tin 8tthe 8tperiod 8tin
8 t overhead.
8twhich 8tit 8tis 8tincurred.
1-2
a. Direct 8tmaterials 8tare 8tan
8tintegral 8tpart 8tof 8ta 8 t finished
8tproduct 8tand 8ttheir 8tcosts 8tcan 8tbe
8 t conveniently 8ttraced 8tto 8tit.
b. Indirect 8tmaterials 8tare 8tgenerally
8tsmall 8 t items 8tof 8tmaterial 8tsuch 8tas
8tglue 8tand 8tnails. 8tThey 8 t may 8tbe 8tan
8tintegral 8tpart 8tof 8ta 8tfinished 8tproduct
8tbut 8ttheir 8tcosts 8tcan 8tbe 8ttraced 8tto
8tthe 8tproduct 8tonly 8tat 8 t great 8tcost 8tor
8tinconvenience.
c. Direct 8tlabor 8tconsists 8tof
8tlabor 8tcosts 8tthat 8 t can 8tbe
8teasily 8ttraced 8tto 8tparticular
8tproducts.
Direct 8tlabor 8tis 8talso 8tcalled 8t―touch
8tlabor.‖
d. Indirect 8tlabor 8tconsists 8tof 8tthe
8tlabor 8tcosts 8 t of 8tjanitors, 8tsupervisors,
8tmaterials 8thandlers, 8tand 8 t other
8tfactory 8tworkers 8tthat 8tcannot 8tbe
8tconveniently 8ttraced 8tto 8tparticular
8tproducts. 8tThese 8tlabor 8tcosts 8 t are
8tincurred 8tto 8tsupport 8 t production,
8tbut 8tthe 8tworkers 8tinvolved 8tdo 8tnot
8 t directly 8twork 8ton 8tthe 8tproduct.
e. Manufacturing 8 t overhead
8 t includes 8tall 8 t manufacturing 8tcosts
8texcept 8tdirect 8tmaterials 8tand 8 t direct
8tlabor. 8tConsequently, 8t manufacturing
8toverhead 8tincludes 8tindirect 8tmaterials
8tand 8tindirect 8 t labor 8tas 8twell 8tas 8tother
8tmanufacturing 8tcosts.
1-3 A 8tproduct 8tcost 8tis 8tany 8tcost
8tinvolved 8tin 8tpurchasing 8tor
8tmanufacturing 8tgoods. 8tIn 8tthe 8tcase
8 t of 8tmanufactured 8tgoods, 8tthese 8tcosts
, 1-4
a. Variable 8tcost: 8tThe 8tvariable
8tcost 8tper 8tunit 8tis 8tconstant,
8tbut 8ttotal 8tvariable 8tcost
8tchanges 8tin 8tdirect 8tproportion
8tto 8tchanges 8tin 8tvolume.
b. Fixed 8tcost: 8tThe 8ttotal 8tfixed 8tcost
8tis 8tconstant 8 t within 8tthe
8trelevant 8trange. 8tThe 8taverage
8tfixed 8 t cost 8tper 8tunit 8tvaries
8tinversely 8twith 8tchanges 8tin
8tvolume.
c. Mixed 8tcost: 8tA 8tmixed 8tcost
8tcontains 8tboth 8 t variable
8tand 8tfixed 8tcost 8telements.
1-5
a. Unit 8tfixed 8tcosts 8tdecrease
8tas 8tthe 8tactivity 8tlevel
8tincreases.
b. Unit 8tvariable 8tcosts 8tremain
8tconstant 8tas 8tthe 8 t activity
8tlevel 8tincreases.
c. Total 8tfixed 8tcosts 8tremain
8tconstant 8tas 8tthe 8 t activity
8tlevel 8tincreases.
d. Total 8tvariable 8tcosts 8tincrease
8tas 8tthe 8tactivity 8tlevel
8tincreases.
1-6
a. Cost 8tbehavior: 8tCost 8tbehavior
8trefers 8 t to 8tthe 8tway 8tin 8twhich
8tcosts 8tchange 8tin 8tresponse 8tto
8tchanges 8tin 8ta 8tmeasure 8tof
8tactivity 8tsuch 8tas 8 t sales
8tvolume, 8tproduction 8tvolume,
8tor 8torders 8tprocessed.
b. Relevant 8trange: 8tThe 8trelevant
8trange 8 t is 8tthe 8 t range 8tof
8tactivity 8twithin 8twhich
8tassumptions 8 t about 8tvariable
8tand 8 t fixed 8tcost 8tbehavior 8tare
8 t valid.
1-7 An 8 t activity 8 t base 8 t is 8 t a
8 t measure 8tof 8 t whatever 8tcauses
8tthe 8tincurrence 8tof 8ta 8tvariable
8 t cost. 8tExamples 8tof 8tactivity
8tbases 8tinclude 8tunits 8 t produced,
8tunits 8tsold, 8tletters 8ttyped, 8tbeds
8tin 8ta 8 t hospital, 8tmeals 8tserved
8tin 8ta 8tcafe, 8tservice 8tcalls 8tmade,
8tetc.
1-8 The 8t linear 8t assumption 8t is
8t reasonably
