Solutions Manual for Managerial Accounting 18th Edition by Ray Garrison, Eric Noreen, and Peter Brewer

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

,Table of Contents
k k




ChapterkOne:kManagerialkAccountingkandkCostkConcepts

ChapterkTwo:kJob-OrderkCosting:kCalculatingkUnitkProductkCosts

ChapterkThree:kJob-OrderkCosting:kCostkFlowskandkExternalkReporting

ChapterkFour:kProcesskCosting

ChapterkFive:kCost-Volume-ProfitkRelationships

ChapterkSix:kVariablekCostingkandkSegmentkReporting:kToolskforkManagement

ChapterkSeven:kActivity-BasedkCosting:kAkToolktokAidkDecisionkMaking

ChapterkEight:kMasterkBudgeting

ChapterkNine:kFlexiblekBudgetskandkPerformancekAnalysis

ChapterkTen:kStandardkCostskandkVariances

ChapterkEleven:kResponsibilitykAccountingkSystems

ChapterkTwelve:kStrategickPerformancekMeasurement

ChapterkThirteen:kDifferentialkAnalysis:kThekKeyktokDecisionkMaking

ChapterkFourteen:kCapitalkBudgetingkDecisions

ChapterkFifteen:kStatementkofkCashkFlows

ChapterkSixteen:kFinancialkStatementkAnalysis

,Chapter 1 k



Managerial Accounting and Cost Concepts
k k k k




Questions


1-1 Thekthreekmajorktypeskofkproductkcostsk 1-4
inkakmanufacturingkcompanykarekdirectkmateria a. Variablekcost:kThekvariablekcostkperkunitkisk
ls,kdirectklabor,kandkmanufacturingkoverhead. constant,kbutktotalkvariablekcostkchangeskin
kdirectkproportionktokchangeskinkvolume.
1-2 b. Fixedkcost:kThektotalkfixedkcostkiskconstantkw
a. Directkmaterialskarekankintegralkpartkofkak ithinkthekrelevantkrange.kThekaveragekfixedkc
finishedkproductkandktheirkcostskcankbekconveni ostkperkunitkvarieskinverselykwithkchangesk in
entlyktracedktokit. kvolume.

b. Indirectkmaterialskarekgenerallyksmallkite c. Mixedkcost:kAkmixedkcostkcontainskbothk
mskofkmaterialksuchkaskgluekandknails.kTheykmayk variablekandkfixedkcostkelements.
bekankintegralkpartkofkakfinishedkproductkbutktheir
kcostskcankbektracedktokthekproductkonlykatkgreat 1-5
kcostkorkinconvenience. a. Unitkfixedkcostskdecreasekaskthekactivityklevelk
c. Directklaborkconsistskofklaborkcostskthat increases.
kcankbekeasilyktracedktokparticularkproducts. b. Unitkvariablekcostskremainkconstantkaskthek
Directklaborkiskalsokcalledk―touchklabor.‖ activityklevelkincreases.
d. Indirectklaborkconsistskofktheklaborkcostsk c. Totalkfixedkcostskremainkconstantkaskthe
ofkjanitors,ksupervisors,kmaterialskhandlers,kand kactivityklevelkincreases.
kotherkfactorykworkerskthatkcannotkbekconvenie d. Totalkvariablekcostskincreasekaskthekactivityk
ntlyktracedktokparticularkproducts.kTheseklaborkc levelkincreases.
ostskarekincurredktoksupportkproduction,kbutkthe
kworkerskinvolvedkdoknotkdirectlykworkkonkthekp 1-6
roduct. a. Costkbehavior:kCostkbehaviorkrefersktokthek
e. Manufacturingkoverheadkincludeskallkman waykinkwhichkcostskchangekinkresponsektokc
ufacturingkcostskexceptkdirectkmaterialskandkdire hangeskinkakmeasurekofkactivityksuchkasksal
ctklabor.kConsequently,kmanufacturingkoverhead eskvolume,kproductionkvolume,korkorderskpr
kincludeskindirectkmaterialskandkindirectklaborkask ocessed.
wellkaskotherkmanufacturingkcosts. b. Relevantkrange:kThekrelevantkrangekiskthek
rangekofkactivitykwithinkwhichkassumptions
1-3 kaboutkvariablekandkfixedkcostkbehaviorkar
Akproductkcostkiskanykcostkinvolvedkinkpu ekvalid.
rchasingkorkmanufacturingkgoods.kInkthekcasekof
kmanufacturedkgoods,kthesekcostskconsistkofkdir 1-7 Ankactivitykbasekiskakmeasurekofkwha
ectkmaterials,kdirectklabor,kandkmanufacturingkov teverkcauseskthekincurrencekofkakvariablekcost
erhead.kAkperiodkcostkiskakcostkthatkisktakenkdire .kExampleskofkactivitykbaseskincludekunitskpro
ctlyktokthekincomekstatementkaskankexpensekinkt duced,kunitsksold,klettersktyped,kbedskinkakho
hekperiodkinkwhichkitkiskincurred. spital,kmealskservedkinkakcafe,kservicekcallskm
ade,ketc.

1-8 Theklinearkassumptionkiskreasonablykvali

, dkprovidingkthatkthekcostkformulakiskusedkonlykw
ithinkthekrelevantkrange.