SOLUTIONMANUAL y
Horngren's Accounting, 13th Edition Managerial
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by Tracie Miller-Nobles, Brenda Mattison, All Chapter 1-9
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,THE MANAGERIAL CHAPTERS
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1. Introduction to Managerial Accounting
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2. Job Order Costing
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3. Process Costing
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4. Cost-Volume-Profit Analysis y
5. Master Budgets
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6. Flexible Budgets and Standard Cost Systems
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7. Cost Allocation and Responsibility Accounting
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8. Short-Term Business Decisions
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9. Capital Investment Decisions
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,Chapter 1 y
Introduction to Managerial Accounting
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Review Questions
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1. Theyprimaryypurposeyofymanagerialyaccountingyisytoyprovideyinformationytoyhelpymanagersypla
n,y direct,ycontrol,yandymakeydecisions.
2. Financialyaccountingyandymanagerialyaccountingydifferyonytheyfollowingy6ydimensions:y(1)yprimar
yy users,y(2)ypurposeyofyinformation,y(3)yfocusyandytimeydimensionyofytheyinformation,y(4)yrulesyan
dy restrictions,y(5)yscopeyofyinformation,yandy(6)ybehavioral.
3. Lineypositionsyareydirectlyyinvolvedyinyprovidingygoodsyoryservicesytoycustomers.yStaffypositionsy
supportylineypositions.
4. Planningymeansychoosingygoalsyandydecidingyhowytoyachieveythem.yDirectingyinvolvesyrunningytheyday-
y to-
dayyoperationsyofyaybusiness.yControllingyisytheyprocessyofymonitoringyoperationsyandykeepingthey com
panyyonytrack.
5. TheyfouryIMAystandardsyofyethicalypracticeyandyaydescriptionyofyeachyfollow.
I. Competence.
Maintainyanyappropriateylevelyofyprofessionalyleadershipyandyexpertiseybyyenhancing
y knowledgeyandyskills.
Performyprofessionalydutiesyinyaccordanceywithyrelevantylaws,yregulations,yandytechnica
ly standards.
Provideydecisionysupportyinformationyandyrecommendationsythatyareyaccurate,yclear,yconcise,
y andytimely.
Recogniseyandyhelpymangeyrisk.
II. Confidentiality.
Keepyinformationyconfidentialyexceptywhenydisclosureyisyauthorizedyorylegallyyrequired.y Info
rmyallyrelevantypartiesyregardingyappropriateyuseyofyconfidentialyinformation.y Monitorytoy e
nsureycompliance.
yRefrainyfromyusingyconfidentialyinformationyforyunethicalyoryillegalyadvantage.
III. Integrity.
Mitigateyactualyconflictsyofyinterest.yRegularlyycommunicateywithybusinessyassociatesytoyavoidy a
pparentyconflictsyofyinterest.y Adviseyallypartiesyofyanyypotentialyconflicts.
Refrainyfromyengagingyinyanyyconductythatywouldyprejudiceycarryingyoutydutiesyethically.
, Abstainyfromyengagingyinyorysupportingyanyyactivityythatymightydiscreditytheyprofession.y C
ontributeytoyaypositiveyethicalycultureyandyplaceyintegrityyofytheyprofessionyaboveypersonal
y interest.
5,ycont.
IV. Credibility.
Communicateyinformationyfairlyyandyobjectively.
Provideyallyrelevantyinformationythatycouldyreasonablyybeyexpectedytoyinfluenceyanyintendedy
user’syunderstandingyofytheyreports,yanalyses,yoryrecommendations.
Reportyanyydelaysyorydeficienciesyinyinformation,ytimeliness,yprocessing,yoryinternalycontrolsiny
conformanceywithyorganizationypolicyyand/oryapplicableylaw.
Communicateyanyyprofessionalylimitationsyoryotheryconstraintsythatywouldyprecludeyresponsi-
y bleyjudgmentyorysuccessfulyperformanceyofyanyactivity.
6. Serviceycompaniesysellytime,yskills,yandyknowledge.y Examplesyofyserviceycompaniesyincludeyphoney ser
viceycompanies,ybanks,ycleaningyserviceycompanies,yaccountingyfirms,ylawyfirms,ymedicalyphysicians,y a
ndyonlineyauctionyservices.
7. Merchandisingycompaniesyresellyproductsytheyybuyyfromysuppliers.yMerchandisersykeepyanyinventoryof
y products,yandymanagersyareyaccountableyforytheypurchasing,ystorage,yandysaleyofytheyproducts.yExam
plesy ofymerchandisingycompaniesyincludeytoyystores,ygroceryystores,yandyclothingystores.
8. Merchandisingycompaniesyresellyproductsytheyypreviouslyyboughtyfromysuppliers,ywhereasy manufac
turingycompaniesyuseylabor,yequipment,ysupplies,yandyfacilitiesytoyconvertyrawymaterialsyintoy newyfi
nishedyproducts.yInycontrastytoymerchandisingycompanies,ymanufacturingycompaniesyhaveyay broadyr
angeyofyproductionyactivitiesythatyrequireytrackingycostsyonythreeykindsyofyinventory.
9. TheythreeyinventoryyaccountsyusedybyymanufacturingycompaniesyareyRawyMaterialsyInventory,yWork-in-
y ProcessyInventory,yandyFinishedyGoodsyInventory.
RawyMaterialsyInventoryyincludesymaterialsyusedytoymanufactureyayproduct.yWork-in-
ProcessInventoryy includesygoodsythatyhaveybeenystartedyinytheymanufacturingyprocessybutyareynotyyety
complete.y Finishedy GoodsyInventoryyincludesycompletedygoodsythatyhaveynotyyetybeenysold.
10. Aydirectycostyisyaycostythatycanybeyeasilyyandycost-
effectivelyytracedytoyaycostyobjecty(whichyisyanythingy forywhichymanagersywantyayseparateymeasure
mentyofycost).yAnyindirectycostyisyaycostythatcannotybey easilyyorycost-
effectivelyytracedytoyaycostyobject.
11. Theythreeymanufacturingycostsyforyaymanufacturingycompanyyareydirectymaterials,ydirectylabor,yandy
manufacturingyoverhead.yDirectymaterialsyareymaterialsythatybecomeyayphysicalypartyofyayfinishedy p
roductyandywhoseycostsyareyeasilyytraceableytoytheyfinishedyproduct.y Directylaboryisytheylaborycostyof
y theyemployeesywhoyconvertymaterialsyintoyfinishedyproducts.yManufacturingyoverheadyincludesyally
manufacturingycostsyexceptydirectymaterialsyandydirectylabor,ysuchyasyindirectymaterials,yindirectylabo
r,y factoryydepreciation,yfactoryyrent,yandyfactoryypropertyytaxes.
