SOLUTION MANUAL
Horngren's Accounting, The Managerial Chapters, 14th
Edition
By Tracie Miller-Nobles Brenda Mattison, All Chapters 1 - 9
,Table of contents
g g
1. Introduction to Managerial Accounting
g g g
2. Job Order Costing
g g
3. Process Costingg
4. Cost-Volume-Profit Analysis g
5. Master Budgets g
6. Flexible Budgets and Standard Cost Systems
g g g g g
7. Cost Allocation and Responsibility Accounting
g g g g
8. Short-Term Business Decisions
g g
9. Capital Investment Decisions
g g
,Chapter M:1 g
Introduction to Managerial Accounting
g g g
Review Questions
g
1. Whatgisgthegprimarygpurposegofgmanagerialgaccounting?
Thegprimarygpurposegofgmanagerialgaccountinggisgtogprovideginformationgtoghelpgmanager
sgplan,gdirect,gcontrol,gandgmakegdecisions.
2. Listgsixgdifferencesgbetweengfinancialgaccountinggandgmanagerialgaccounting.
Financialgaccountinggandgmanagerialgaccountinggdiffergongthegfollowingg6gdimensions:g(1)gpri
marygusers,g(2)gpurposegofginformation,g(3)gfocusgandgtimegdimensiongofgtheginformation,g(4)gr
ulesgandgre-gstrictions,g(5)gscopegofginformation,gandg(6)gbehavioral.
3. Explaingthegdifferencegbetweenglinegpositionsgandgstaffgpositions.
Linegpositionsgaregdirectlyginvolvedgingprovidingggoodsgorgservicesgtogcustomers.gStaffgposit
ionsgsupportglinegpositions.
4. Explaingthegdifferencesgbetweengplanning,gdirecting,gandgcontrolling.
Planninggmeansgchoosingggoalsgandgdecidingghowgtogachievegthem.gDirectingginvolvesgrunningg
thegday-to-
daygoperationsgofgagbusiness.gControllinggisgthegprocessgofgmonitoringgoperationsgandgkeepinggt
hegcompanygongtrack.
5. ListgthegfourgIMAgstandardsgofgethicalgpracticegandgbrieflygdescribegeach.
ThegfourgIMAgstandardsgofgethicalgpracticegandgagdescriptiongofgeachgfollow.
I. Competence.
Maintaingangappropriateglevelgofgprofessionalgleadershipgandgexpertisegbygenha
ncinggknowledgegandgskills.
Performgprofessionalgdutiesgingaccordancegwithgrelevantglaws,gregulations,gandgtech
nicalgstandards.
Providegdecisiongsupportginformationgandgrecommendationsgthatgaregaccurate,gclear,gconcis
e,
, andgtimely.
Recognisegandghelpgmangegrisk.
II. Confidentiality.
Keepginformationgconfidentialgexceptgwhengdisclosuregisgauthorizedgorglegallygrequired.
Informgallgrelevantgpartiesgregardinggappropriategusegofgconfidentialginformation.g Mon
itorgtogensuregcompliance.
Refraingfromgusinggconfidentialginformationgforgunethicalgorgillegalgadvantage.
III. Integrity.
Mitigategactualgconflictsgofginterest.gRegularlygcommunicategwithgbusinessgassociatesgtoga
voidgapparentgconflictsgofginterest.ggAdvisegallgpartiesgofganygpotentialgconflicts.
Refraingfromgengagingginganygconductgthatgwouldgprejudicegcarryinggoutgdutiesgethically.
Abstaingfromgengaginggingorgsupportingganygactivitygthatgmightgdiscreditgthegprofession.
Contributegtogagpositivegethicalgculturegandgplacegintegritygofgthegprofessiongabovegper
sonalginterest.
5,gcont.
IV. Credibility.
Communicateginformationgfairlygandgobjectively.
Providegallgrelevantginformationgthatgcouldgreasonablygbegexpectedgtoginfluencegangint
endedguser’sgunderstandinggofgthegreports,ganalyses,gorgrecommendations.
Reportganygdelaysgorgdeficienciesginginformation,gtimeliness,gprocessing,gorginternalgcon
trolsgingconformancegwithgorganizationgpolicygand/orgapplicableglaw.
Communicateganygprofessionalglimitationsgorgothergconstraintsgthatgwouldgprecludegres
ponsi-gblegjudgmentgorgsuccessfulgperformancegofgangactivity.
6. Describegagservicegcompanygandggivegangexample.
Servicegcompaniesgsellgtime,gskills,gandgknowledge.gExamplesgofgservicegcompaniesgincludegph
onegservicegcompanies,gbanks,gcleaninggservicegcompanies,gaccountinggfirms,glawgfirms,gmedic
algphysi-gcians,gandgonlinegauctiongservices.
7. Describegagmerchandisinggcompanygandggivegangexample.
Merchandisinggcompaniesgresellgproductsgtheygbuygfromgsuppliers.gMerchandisersgkeepganginve
ntorygofgproducts,gandgmanagersgaregaccountablegforgthegpurchasing,gstorage,gandgsalegofgthegpr
oducts.gEx-
gamplesgofgmerchandisinggcompaniesgincludegtoygstores,ggrocerygstores,gandgclothinggstores.
8. Howgdogmanufacturinggcompaniesgdiffergfromgmerchandisinggcompanies?
Merchandisinggcompaniesgresellgproductsgtheygpreviouslygboughtgfromgsuppliers,gwhereasgman
ufac-
Horngren's Accounting, The Managerial Chapters, 14th
Edition
By Tracie Miller-Nobles Brenda Mattison, All Chapters 1 - 9
,Table of contents
g g
1. Introduction to Managerial Accounting
g g g
2. Job Order Costing
g g
3. Process Costingg
4. Cost-Volume-Profit Analysis g
5. Master Budgets g
6. Flexible Budgets and Standard Cost Systems
g g g g g
7. Cost Allocation and Responsibility Accounting
g g g g
8. Short-Term Business Decisions
g g
9. Capital Investment Decisions
g g
,Chapter M:1 g
Introduction to Managerial Accounting
g g g
Review Questions
g
1. Whatgisgthegprimarygpurposegofgmanagerialgaccounting?
Thegprimarygpurposegofgmanagerialgaccountinggisgtogprovideginformationgtoghelpgmanager
sgplan,gdirect,gcontrol,gandgmakegdecisions.
2. Listgsixgdifferencesgbetweengfinancialgaccountinggandgmanagerialgaccounting.
Financialgaccountinggandgmanagerialgaccountinggdiffergongthegfollowingg6gdimensions:g(1)gpri
marygusers,g(2)gpurposegofginformation,g(3)gfocusgandgtimegdimensiongofgtheginformation,g(4)gr
ulesgandgre-gstrictions,g(5)gscopegofginformation,gandg(6)gbehavioral.
3. Explaingthegdifferencegbetweenglinegpositionsgandgstaffgpositions.
Linegpositionsgaregdirectlyginvolvedgingprovidingggoodsgorgservicesgtogcustomers.gStaffgposit
ionsgsupportglinegpositions.
4. Explaingthegdifferencesgbetweengplanning,gdirecting,gandgcontrolling.
Planninggmeansgchoosingggoalsgandgdecidingghowgtogachievegthem.gDirectingginvolvesgrunningg
thegday-to-
daygoperationsgofgagbusiness.gControllinggisgthegprocessgofgmonitoringgoperationsgandgkeepinggt
hegcompanygongtrack.
5. ListgthegfourgIMAgstandardsgofgethicalgpracticegandgbrieflygdescribegeach.
ThegfourgIMAgstandardsgofgethicalgpracticegandgagdescriptiongofgeachgfollow.
I. Competence.
Maintaingangappropriateglevelgofgprofessionalgleadershipgandgexpertisegbygenha
ncinggknowledgegandgskills.
Performgprofessionalgdutiesgingaccordancegwithgrelevantglaws,gregulations,gandgtech
nicalgstandards.
Providegdecisiongsupportginformationgandgrecommendationsgthatgaregaccurate,gclear,gconcis
e,
, andgtimely.
Recognisegandghelpgmangegrisk.
II. Confidentiality.
Keepginformationgconfidentialgexceptgwhengdisclosuregisgauthorizedgorglegallygrequired.
Informgallgrelevantgpartiesgregardinggappropriategusegofgconfidentialginformation.g Mon
itorgtogensuregcompliance.
Refraingfromgusinggconfidentialginformationgforgunethicalgorgillegalgadvantage.
III. Integrity.
Mitigategactualgconflictsgofginterest.gRegularlygcommunicategwithgbusinessgassociatesgtoga
voidgapparentgconflictsgofginterest.ggAdvisegallgpartiesgofganygpotentialgconflicts.
Refraingfromgengagingginganygconductgthatgwouldgprejudicegcarryinggoutgdutiesgethically.
Abstaingfromgengaginggingorgsupportingganygactivitygthatgmightgdiscreditgthegprofession.
Contributegtogagpositivegethicalgculturegandgplacegintegritygofgthegprofessiongabovegper
sonalginterest.
5,gcont.
IV. Credibility.
Communicateginformationgfairlygandgobjectively.
Providegallgrelevantginformationgthatgcouldgreasonablygbegexpectedgtoginfluencegangint
endedguser’sgunderstandinggofgthegreports,ganalyses,gorgrecommendations.
Reportganygdelaysgorgdeficienciesginginformation,gtimeliness,gprocessing,gorginternalgcon
trolsgingconformancegwithgorganizationgpolicygand/orgapplicableglaw.
Communicateganygprofessionalglimitationsgorgothergconstraintsgthatgwouldgprecludegres
ponsi-gblegjudgmentgorgsuccessfulgperformancegofgangactivity.
6. Describegagservicegcompanygandggivegangexample.
Servicegcompaniesgsellgtime,gskills,gandgknowledge.gExamplesgofgservicegcompaniesgincludegph
onegservicegcompanies,gbanks,gcleaninggservicegcompanies,gaccountinggfirms,glawgfirms,gmedic
algphysi-gcians,gandgonlinegauctiongservices.
7. Describegagmerchandisinggcompanygandggivegangexample.
Merchandisinggcompaniesgresellgproductsgtheygbuygfromgsuppliers.gMerchandisersgkeepganginve
ntorygofgproducts,gandgmanagersgaregaccountablegforgthegpurchasing,gstorage,gandgsalegofgthegpr
oducts.gEx-
gamplesgofgmerchandisinggcompaniesgincludegtoygstores,ggrocerygstores,gandgclothinggstores.
8. Howgdogmanufacturinggcompaniesgdiffergfromgmerchandisinggcompanies?
Merchandisinggcompaniesgresellgproductsgtheygpreviouslygboughtgfromgsuppliers,gwhereasgman
ufac-
