Solution manual for horngren s accounting the managerial
chapters 14th edition By Tracie Miller-Nobles Brenda
Mattison, All Chapters 1 - 9
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, Tableofcontents s
1. IntroductiontoManagerialAccountings s s
2. JobOrderCosting
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3. Process Costing s
4. Cost-Volume-ProfitAnalysis s
5. MasterBudgets s
6. Flexible Budgets and Standard Cost Systems
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7. CostAllocationandResponsibilityAccounting
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8. Short-Term Business Decisions s s
9. CapitalInvestment Decisions
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, ChapterM:1 s
Introduction to Managerial Accounting s s s
Review Questions s
1. What is the primary purpose of managerial accounting?
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The primary purpose of managerial accounting is to provide information to help managers pla
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n,direct, control, and make decisions.
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2. List six differences between financial accounting and managerial accounting.
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Financial accounting and managerial accounting differ on the following 6 dimensions: (1) primary
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users, (2) purpose of information, (3) focus and time dimension of the information, (4) rules and r
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e-strictions, (5) scope of information, and (6) behavioral.
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3. Explain the difference between line positions and staff positions.
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Line positions are directly involved in providing goods or services to customers. Staff position
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ssupport line positions.
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4. Explain the differences between planning, directing, and controlling.
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Planning means choosing goals and deciding how to achieve them. Directing involves running the
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day-to-
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day operations of a business. Controlling is the process of monitoring operations and keepingthe c
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ompany on track.
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5. List the four IMA standards of ethical practice and briefly describe each.
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The four IMA standards of ethical practice and a description of each follow.
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I. Competence.
Maintain an appropriate level of professional leadership and expertise by enhanci
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ngknowledge and skills.
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Perform professional duties in accordance with relevant laws, regulations, and technic
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alstandards. s
Provide decision support information and recommendations that are accurate, clear, concise,
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, and timely. s
Recognise and help mange risk.
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II. Confidentiality.
Keep information confidential except when disclosure is authorized or legally required.
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Inform all relevant parties regarding appropriate use of confidential information. Monitor
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toensure compliance.
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Refrain from using confidential information for unethical or illegal advantage.
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III. Integrity.
Mitigate actual conflicts of interest. Regularly communicate with business associates to avoi
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dapparent conflicts of interest. Advise all parties of any potential conflicts.
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Refrain from engaging in any conduct that would prejudice carrying out duties ethically.
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Abstain from engaging in or supporting any activity that might discredit the profession.
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Contribute to a positive ethical culture and place integrity of the profession above perso
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nalinterest.
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5, cont.
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IV. Credibility.
Communicate information fairly and objectively. s s s s
Provide all relevant information that could reasonably be expected to influence an intend
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eduser’s understanding of the reports, analyses, or recommendations.
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Report any delays or deficiencies in information, timeliness, processing, or internal contro
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lsin conformance with organization policy and/or applicable law.
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Communicate any professional limitations or other constraints that would preclude respon
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si-ble judgment or successful performance of an activity.
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6. Describe a service company and give an example.
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Service companies sell time, skills, and knowledge. Examples of service companies include phone
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service companies, banks, cleaning service companies, accounting firms, law firms, medical physi
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-cians, and online auction services.
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7. Describe a merchandising company and give an example.
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Merchandising companies resell products they buy from suppliers. Merchandisers keep an invento
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ryof products, and managers are accountable for the purchasing, storage, and sale of the products.
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Ex- amples of merchandising companies include toy stores, grocery stores, and clothing stores.
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8. How do manufacturing companies differ from merchandising companies?
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Merchandising companies resell products they previously bought from suppliers, whereas manufa
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c-
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