Solution Manual for Managerial Accounting 18th Edition By Ray Garrison, Eric Noreen and Peter Brewer 2024

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

,TableofContents 2
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Chapter One: Managerial Accounting and Cost Concepts Ch
2 i 2 i 2 i 2 i 2 i 2 i 2i




apter Two: Job-Order Costing: Calculating Unit Product Costs
2i 2i 2i 2i 2i 2i 2i




Chapter Three: Job- 2i 2i




Order Costing: Cost Flows and External Reporting Chapter Four: Process Co
2i 2i 2i 2i 2i 2i 2i 2i 2i 2i




sting

Chapter Five: Cost-Volume-Profit Relationships
2i 2i 2i




Chapter Six: Variable Costing and Segment Reporting: Tools for Managemen
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t Chapter Seven: Activity-
2i 2 i 2 i




Based Costing: A Tool to Aid Decision Making Chapter Eight: Master B
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udgeting

Chapter Nine: Flexible Budgets and Performance Analysis Chapt
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er Ten: Standard Costs and Variances
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Chapter Eleven: Responsibility Accounting Systems Cha
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pter Twelve: Strategic Performance Measurement
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Chapter Thirteen: Differential Analysis: The Key to Decision Making Cha
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pter Fourteen: Capital Budgeting Decisions
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Chapter Fifteen: Statement ofDCash Flows Ch
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apter Sixteen: Financial Statement Analysis
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,Chapter1 2
i




Managerial Accounting and Cost Concepts 2i 2i 2i 2i




Questions


1-1 The three major types of product cost 2i 2i 2i 2i 2i 2i 2i 1-4
s in a manufacturing company are direct mat e
2i 2i 2i 2i 2i 2i 2i 2i a. Variable cost: The variable costDper unit i 2i 2i 2i 2i 2i 2i 2


rials, direct labor, and manufacturing overhe a
2i 2i 2i 2i 2i 2i s constant, but total variable cost change
i 2i 2i 2i 2i 2i 2i


d. s in direct proportion to changes in volu
2 i 2i 2i 2i 2i 2i 2i 2i 2i


me.
1-2 b. Fixed cost: The total fixed cost is constant
2i 2i 2i 2i 2i 2i 2i 2i


a. Direct materials are an integral part ofD 2i 2i 2i 2i 2i 2i 2 within the relevant range. The average fix 2i 2i 2i 2i 2i 2i 2i

ia finished productDand their costs can be con
2i 2i 2i 2i 2i 2i 2i 2i ed cost per unitDvaries inversely with chan
2i 2i 2i 2i 2i 2i 2i

veniently traced to it. 2i 2i 2i ges in volume. 2 i 2i

b. Indirect materials are generally small ite 2i 2i 2i 2i 2i 2i c. Mixed cost: A mixed cost contains bot 2i 2i 2i 2i 2i 2i 2i


ms of material such as glue and nails. They m a
2i 2i 2i 2i 2i 2i 2i 2i 2i 2i h variable and fixed cost elements.
2i 2i 2i 2i 2i


y be an integral part ofDa finished product but t
2i 2i 2i 2i 2i 2i 2i 2i 2i

heir costs can be traced to the product o
2 i 2 i 2 i 2 i 2 i 2 i 2 i 2 i 1-5
nly at great cost or inconvenience.
2i 2i 2i 2i 2i a. Unit fixed costs decrease as the activity lev
2i 2i 2i 2i 2i 2i 2i 2i

c. Direct labor consists of labor costs th 2i 2i 2i 2i 2i 2i 2i el increases. 2i


at can be easily traced to particular product
2i 2i 2i 2i 2i 2i 2i 2i b. Unit variable costs remain constantDas th
2i 2i 2i 2i 2i 2


s. e activity level increases.
i 2i 2i 2i

Direct labor is also called ―touch labor.‖
2i 2i 2i 2i 2i 2i c. Total fixed costs remain constant as th 2i 2i 2i 2i 2i 2i 2i


d. Indirect labor consists of the labor cost 2i 2i 2i 2i 2i 2i 2 e activity level increases.
2i 2i 2i


is ofDjanitors, supervisors, materials handlers,
2i 2i 2i 2i 2i d. Total variable costs increase as the activit
2i 2i 2i 2i 2i 2i 2i


a nd other factory workers that cannotDbe conv
2i 2i 2i 2i 2i 2i 2i y level increases.
2i 2i


eniently traced to particular products. These l
2i 2i 2i 2i 2i 2i 2i 2i


abor costs are incurred to support production,
2i 2i 2i 2i 2i 2i 2i 1-6
but the workers involved do not directly wor kD
2i 2i 2i 2i 2i 2i 2i 2i a. Cost behavior: CostDbehavior refers to the
2i 2i 2i 2i 2i 2i


on the product.
2i 2i way in which costs change in response
2i 2i 2i 2i 2i 2i


e. Manufacturing overhead includes all ma 2i 2i 2i 2i 2i t o changes in a measure of activity such
2i 2i 2i 2i 2i 2i 2i 2i 2i 2i


nufacturing costs except direct materials and d i 2i 2i 2i 2i 2i 2i 2i a s sales volume, production volume, or
2 i 2i 2i 2i 2i 2i 2i

rectDlabor. Consequently, manufacturing overh 2i 2i 2i 2i ord ers processed. 2i 2i

ead includes indirect materials and indirect lab
2i 2i 2i 2i 2i 2i 2i b. Relevant range: The relevant range is th 2i 2i 2i 2i 2i 2i 2i

or as well as other manufacturing costs.
2i 2i 2i 2i 2i 2i e range of activity within which assumpti
2i 2i 2i 2i 2i 2i 2i

ons about variable and fixed cost behavi
2i 2i 2i 2i 2i 2i 2i

1-3 or are valid. 2i 2i

A product cost is any costDinvolved in 2i 2i 2i 2i 2i 2i 2i


purchasing or manufacturing goods. In the cas 2i 2i 2i 2i 2i 2i 2 1-7 An activity base is a measure ofDw h 2i 2i 2i 2i 2i 2i 2i


e of manufactured goods, these costs consist
i 2i 2i 2i 2i 2i 2i 2 atever causes the incurrence of a variable co
2i 2i 2i 2i 2i 2i 2i


i of direct materials, direct labor, and manufact
2i 2i 2i 2i 2i 2i st. Examples of activity bases include uni ts
2i 2i 2i 2i 2i 2i 2i 2i


u ring overhead. A period cost is a cost that is
2i 2i 2i 2i 2i 2i 2i 2i 2i 2i 2i produced, units sold, letters typed, beds in 2i 2i 2i 2i 2i 2 i 2i


t aken directly to the income statement as an e
2i 2i 2i 2i 2i 2i 2i 2i 2i a hospital, meals served in a cafe, servic e
2i 2i 2i 2i 2i 2i 2i 2 i 2i


xpense in the period in which it is incurred.
2i 2i 2i 2i 2i 2i 2i 2i 2i calls made, etc.2i 2i

, 1-8 The linear assumption is reasonably v
2i 2i 2i 2i 2i 2i


alid providing that the cost formula is used on
2i 2i 2i 2i 2i 2i 2i 2i 2i


ly within the relevant range.
2i 2i 2i 2i