Solution manual for managerial accounting 18th edition by ray garrison eric noreen and peter brewer_compressed

Solution Manual for Managerial Accounting,
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18th Edition q,j




By Ray Garrison, Eric Noreen and Peter Brewer
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Verified Chapter's 1 - 16 | Complete
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,Table of Contents q,j q,j




Chapter One: Managerial Accounting and Cost Concepts
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Chapter Two: Job-Order Costing: Calculating Unit Product Costs
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Chapter Three: Job-Order Costing: Cost Flows and External Reporting
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Chapter Four: Process Costing
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Chapter Five: Cost-Volume-Profit Relationships
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Chapter Six: Variable Costing and Segment Reporting: Tools for Management
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Chapter Seven: Activity-Based Costing: A Tool to Aid Decision Making
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Chapter Eight: Master Budgeting
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Chapter Nine: Flexible Budgets and Performance Analysis
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Chapter Ten: Standard Costs and Variances
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Chapter Eleven: Responsibility Accounting Systems
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Chapter Twelve: Strategic Performance Measurement
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Chapter Thirteen: Differential Analysis: The Key to Decision Making
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Chapter Fourteen: Capital Budgeting Decisions
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Chapter Fifteen: Statement of Cash Flows
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Chapter Sixteen: Financial Statement Analysis
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,Chapter 1 q,j




ManagerialAccountingandCost Concepts ,j
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Questions


1-1 Thethreemajortypes ofproductcosts in a q,j q,j q,j q,j ,j
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manufacturing company are direct materials,
q,j q,j q,j q,j q,j a. Variable cost: The variable cost per unit is q,j q,j q,j q,j q,j q,j q,j




direct labor, and manufacturing overhead.
q,j q,j q,j q,j q,j constant,buttotalvariable costchangesin
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direct proportion to changes in volume.
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1-2 b. Fixed cost: The total fixed cost is constant q,j q,j q,j q,j q,j q,j q,j




a. Direct materials are anintegralpart ofa q,j q,j q,j q,j q,j q,j q,j withintherelevantrange.Theaveragefixed
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finished product and their costs can be
q,j q,j q,j q,j q,j q,j q,j cost per unit varies inversely with changes in
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conveniently traced to it.
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b. Indirect materials are generally small items q,j q,j q,j q,j q,j c. Mixedcost:Amixed costcontainsboth ,j
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of material such as glue and nails. They maybe an
q,j q,j q,j q,j q,j q,j q,j q,j q,j q,j q,j variable and fixed cost elements.
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integralpart of a finishedproduct but their costs can
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be traced to the product only at great cost or
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inconvenience.
q,j a. Unit fixedcostsdecrease as theactivitylevel
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c. Directlaborconsists oflaborcoststhat can q,j q,j q,j q,j q,j q,j q,j increases.
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be easily traced to particular products.
q,j q,j q,j q,j q,j q,j b. Unitvariablecostsremainconstant as the
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Direct labor is also called ―touch labor.‖
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activity level increases.
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d. Indirect labor consists of the labor costs of q,j q,j q,j q,j q,j q,j q,j c. Totalfixedcostsremainconstantas the q,j q,j q,j q,j q,j q,j




janitors,supervisors,materialshandlers,and
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q q,j q,j q,j q,j activity level increases.
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other factory workers that cannot be
q,j q,j q,j q,j q,j q,j d. Totalvariablecostsincreaseastheactivity q,j q,j q,j q,j q,j q,j




conveniently traced to particular products. These
q,j q,j q,j q,j q,j q,j level increases.
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labor costs are incurred to support production,
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but the workers involved do not directly work on
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1-6
the product.
q,j q,j a. Cost behavior: Cost behavior refers to the
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e. Manufacturing overhead includes all q,j q,j q,j way in which costs change in response to
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manufacturing costs except direct materials and
q,j q,j q,j q,j q,j q,j changes in a measure of activity such as
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direct labor. Consequently, manufacturing
q,j q,j q,j q,j salesvolume,productionvolume,ororders
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overheadincludes indirectmaterialsandindirect
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labor as well as other manufacturing costs.
q,j q,j q,j q,j q,j q,j q,j b. Relevant range: The relevant range is the q,j q,j q,j q,j q,j q,j




rangeofactivitywithinwhichassumptions
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1-3 A product cost is any cost involved in q,j q,j q,j q,j q,j q,j q,j about variable and fixed cost behavior are
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purchasing or manufacturing goods. In the case of
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manufactured goods, these costs consist of direct
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materials,directlabor,andmanufacturing
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q 1-7 An activity base is a measure of q,j q,j q,j q,j q,j q,j




overhead. A period cost is a cost that is taken
q,j q,j q,j q,j q,j q,j q,j q,j q,j q,j whatevercausesthe incurrence of a variable
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directly to the income statement as an expense in
q,j q,j q,j q,j q,j q,j q,j q,j q,j cost.Examplesofactivitybasesincludeunits
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the period in which it is incurred.
q,j q,j q,j q,j q,j q,j q,j produced, units sold, letters typed, beds in a
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hospital, meals served in a cafe, service calls
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made, etc.
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1-8 The linear assumption is reasonably valid q,j q,j q,j q,j q,j

, providingthatthecostformulais usedonly within
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the relevant range.
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