SOLUTIONMANUAL i
Horngren'sAccounting,13thEditionManagerial
i i i i
by Tracie Miller-Nobles, Brenda Mattison, All Chapter 1-9
i i i i i i i
,THE MANAGERIAL CHAPTERS
ii ii
1. Introduction to Managerial Accounting
ii ii ii
2. Job Order Costing
ii ii
3. Process Costingii
4. Cost-Volume-Profit Analysis ii
5. Master Budgetsii
6. Flexible Budgets and Standard Cost Systems
ii ii ii ii ii
7. Cost Allocation and Responsibility Accounting
ii ii ii ii
8. Short-Term Business Decisions ii ii
9. Capital Investment Decisions
ii ii
,Chapter 1 i
Introduction to Managerial Accounting
i i i
Review Questions
ii ii
1. The iiprimary iipurpose iiof iimanagerial iiaccounting iiis iito iiprovide iiinformation iito iihelp
iimanagers iiplan, i i direct, iicontrol, iiand iimake iidecisions.
2. Financial iiaccounting iiand iimanagerial iiaccounting iidiffer iion iithe iifollowing ii6 iidimensions: ii(1)
iiprimary i i users, ii(2) iipurpose iiof iiinformation, ii(3) iifocus iiand iitime iidimension iiof iithe
iiinformation, ii(4) iirules iiand i i restrictions, ii(5) iiscope iiof iiinformation, iiand ii(6) iibehavioral.
3. Line iipositions iiare iidirectly iiinvolved iiin iiproviding iigoods iior iiservices iito iicustomers. iiStaff
iipositions i i support iiline iipositions.
4. Planning iimeans iichoosing iigoals iiand iideciding iihow iito iiachieve iithem. iiDirecting iiinvolves iirunning iithe
iiday- i i to-day iioperations iiof iia iibusiness. iiControlling iiis iithe iiprocess iiof iimonitoring iioperations iiand
iikeepingthe i i company iion iitrack.
5. The iifour iiIMA iistandards iiof iiethical iipractice iiand iia iidescription iiof iieach iifollow.
I. Competence.
Maintain iian iiappropriate iilevel iiof iiprofessional iileadership iiand iiexpertise iiby
iienhancing i i knowledge iiand iiskills.
Perform iiprofessional iiduties iiin iiaccordance iiwith iirelevant iilaws, iiregulations, iiand
iitechnical i i standards.
Provide iidecision iisupport iiinformation iiand iirecommendations iithat iiare iiaccurate, iiclear,
iiconcise, i i and iitimely.
Recognise iiand iihelp iimange iirisk.
II. Confidentiality.
Keep iiinformation iiconfidential iiexcept iiwhen iidisclosure iiis iiauthorized iior iilegally iirequired.
i i Inform iiall iirelevant iiparties iiregarding iiappropriate iiuse iiof iiconfidential iiinformation.
i i Monitor iito i i ensure icompliance.
iiRefrain iifrom iiusing iiconfidential iiinformation iifor iiunethical iior iiillegal iiadvantage.
III. Integrity.
Mitigate iiactual iiconflicts iiof iiinterest. iiRegularly icommunicate iiwith iibusiness iiassociates iito iiavoid
i i apparent iiconflicts iiof iiinterest. i i Advise iiall iiparties iiof iiany iipotential iiconflicts.
Refrain iifrom iiengaging iiin iiany iiconduct iithat iiwould iiprejudice iicarrying iiout iiduties iiethically.
, Abstain iifrom iiengaging iiin iior iisupporting iiany iactivity iithat iimight iidiscredit iithe iiprofession.
i i Contribute iito iia iipositive iiethical iiculture iiand iiplace iiintegrity iiof iithe iiprofession iiabove
iipersonal i i interest.
5, iicont.
IV. Credibility.
Communicate iiinformation iifairly iand iiobjectively.
Provide iiall iirelevant iiinformation iithat iicould iireasonably ibe iiexpected iito iiinfluence iian
iiintended i i user’s iiunderstanding iiof iithe iireports, iianalyses, iior iirecommendations.
Report iiany iidelays iior iideficiencies iiin iiinformation, iitimeliness, iiprocessing, iior iiinternal
iicontrolsin i i conformance iiwith iiorganization iipolicy iiand/or iiapplicable iilaw.
Communicate iiany iiprofessional iilimitations iior iiother iiconstraints iithat iiwould iipreclude iiresponsi-
i i ble iijudgment iior iisuccessful iiperformance iiof iian iiactivity.
6. Service iicompanies iisell iitime, iiskills, iiand iiknowledge. i i Examples iiof iiservice iicompanies iiinclude
iiphone i i service iicompanies, iibanks, iicleaning iiservice iicompanies, iiaccounting iifirms, iilaw iifirms,
iimedical iiphysicians, i i and iionline iiauction iiservices.
7. Merchandising iicompanies iiresell iiproducts iithey iibuy iifrom iisuppliers. iiMerchandisers iikeep iian
iiinventoryof i i products, iiand iimanagers iiare iiaccountable iifor iithe iipurchasing, iistorage, iiand iisale iiof
iithe iiproducts. iiExamples i i of iimerchandising iicompanies iiinclude iitoy iistores, iigrocery iistores, iiand
iiclothing iistores.
8. Merchandising iicompanies iiresell iiproducts iithey iipreviously iibought iifrom iisuppliers, iiwhereas
i i manufacturing iicompanies iiuse iilabor, iiequipment, iisupplies, iiand iifacilities ito iiconvert iiraw
iimaterials iiinto i i new iifinished iiproducts. iiIn iicontrast iito iimerchandising iicompanies, iimanufacturing
iicompanies iihave iia i i broad iirange iiof iiproduction iiactivities iithat iirequire iitracking iicosts iion iithree
iikinds iiof iiinventory.
9. The iithree iiinventory iiaccounts iiused iiby iimanufacturing iicompanies iiare iiRaw iiMaterials iiInventory,
iiWork-in- i i Process iiInventory, iiand iiFinished iiGoods iiInventory.
Raw iiMaterials iiInventory iiincludes iimaterials iiused iito iimanufacture iia iiproduct. iiWork-in-
ProcessInventory i i includes iigoods iithat iihave iibeen iistarted iiin iithe iimanufacturing iiprocess iibut iiare
iinot iiyet iicomplete. i i Finished i i Goods iiInventory iiincludes iicompleted iigoods iithat iihave iinot iiyet
iibeen iisold.
10. A iidirect iicost iiis iia iicost iithat iican iibe iieasily iiand iicost-effectively iitraced iito iia iicost iiobject ii(which iiis
iianything i i for iiwhich iimanagers iiwant iia iiseparate iimeasurement iiof iicost). iiAn iiindirect iicost iiis iia
iicost iithatcannot iibe i i easily iior iicost-effectively iitraced iito iia iicost iiobject.
11. The iithree iimanufacturing iicosts iifor iia iimanufacturing iicompany iiare iidirect iimaterials, iidirect iilabor,
iiand i i manufacturing iioverhead. iiDirect iimaterials iiare iimaterials iithat iibecome iia iiphysical iipart iiof iia
iifinished i i product iiand iiwhose iicosts iiare iieasily iitraceable iito iithe iifinished iiproduct. i i Direct iilabor
iiis iithe iilabor iicost iiof i i the iiemployees iiwho iiconvert iimaterials iiinto iifinished iiproducts. iiManufacturing
iioverhead iiincludes iiall i i manufacturing iicosts iiexcept iidirect iimaterials iiand iidirect iilabor, iisuch iias
iiindirect iimaterials, iiindirect iilabor, i i factory iidepreciation, iifactory iirent, iiand iifactory iiproperty
iitaxes.
Horngren'sAccounting,13thEditionManagerial
i i i i
by Tracie Miller-Nobles, Brenda Mattison, All Chapter 1-9
i i i i i i i
,THE MANAGERIAL CHAPTERS
ii ii
1. Introduction to Managerial Accounting
ii ii ii
2. Job Order Costing
ii ii
3. Process Costingii
4. Cost-Volume-Profit Analysis ii
5. Master Budgetsii
6. Flexible Budgets and Standard Cost Systems
ii ii ii ii ii
7. Cost Allocation and Responsibility Accounting
ii ii ii ii
8. Short-Term Business Decisions ii ii
9. Capital Investment Decisions
ii ii
,Chapter 1 i
Introduction to Managerial Accounting
i i i
Review Questions
ii ii
1. The iiprimary iipurpose iiof iimanagerial iiaccounting iiis iito iiprovide iiinformation iito iihelp
iimanagers iiplan, i i direct, iicontrol, iiand iimake iidecisions.
2. Financial iiaccounting iiand iimanagerial iiaccounting iidiffer iion iithe iifollowing ii6 iidimensions: ii(1)
iiprimary i i users, ii(2) iipurpose iiof iiinformation, ii(3) iifocus iiand iitime iidimension iiof iithe
iiinformation, ii(4) iirules iiand i i restrictions, ii(5) iiscope iiof iiinformation, iiand ii(6) iibehavioral.
3. Line iipositions iiare iidirectly iiinvolved iiin iiproviding iigoods iior iiservices iito iicustomers. iiStaff
iipositions i i support iiline iipositions.
4. Planning iimeans iichoosing iigoals iiand iideciding iihow iito iiachieve iithem. iiDirecting iiinvolves iirunning iithe
iiday- i i to-day iioperations iiof iia iibusiness. iiControlling iiis iithe iiprocess iiof iimonitoring iioperations iiand
iikeepingthe i i company iion iitrack.
5. The iifour iiIMA iistandards iiof iiethical iipractice iiand iia iidescription iiof iieach iifollow.
I. Competence.
Maintain iian iiappropriate iilevel iiof iiprofessional iileadership iiand iiexpertise iiby
iienhancing i i knowledge iiand iiskills.
Perform iiprofessional iiduties iiin iiaccordance iiwith iirelevant iilaws, iiregulations, iiand
iitechnical i i standards.
Provide iidecision iisupport iiinformation iiand iirecommendations iithat iiare iiaccurate, iiclear,
iiconcise, i i and iitimely.
Recognise iiand iihelp iimange iirisk.
II. Confidentiality.
Keep iiinformation iiconfidential iiexcept iiwhen iidisclosure iiis iiauthorized iior iilegally iirequired.
i i Inform iiall iirelevant iiparties iiregarding iiappropriate iiuse iiof iiconfidential iiinformation.
i i Monitor iito i i ensure icompliance.
iiRefrain iifrom iiusing iiconfidential iiinformation iifor iiunethical iior iiillegal iiadvantage.
III. Integrity.
Mitigate iiactual iiconflicts iiof iiinterest. iiRegularly icommunicate iiwith iibusiness iiassociates iito iiavoid
i i apparent iiconflicts iiof iiinterest. i i Advise iiall iiparties iiof iiany iipotential iiconflicts.
Refrain iifrom iiengaging iiin iiany iiconduct iithat iiwould iiprejudice iicarrying iiout iiduties iiethically.
, Abstain iifrom iiengaging iiin iior iisupporting iiany iactivity iithat iimight iidiscredit iithe iiprofession.
i i Contribute iito iia iipositive iiethical iiculture iiand iiplace iiintegrity iiof iithe iiprofession iiabove
iipersonal i i interest.
5, iicont.
IV. Credibility.
Communicate iiinformation iifairly iand iiobjectively.
Provide iiall iirelevant iiinformation iithat iicould iireasonably ibe iiexpected iito iiinfluence iian
iiintended i i user’s iiunderstanding iiof iithe iireports, iianalyses, iior iirecommendations.
Report iiany iidelays iior iideficiencies iiin iiinformation, iitimeliness, iiprocessing, iior iiinternal
iicontrolsin i i conformance iiwith iiorganization iipolicy iiand/or iiapplicable iilaw.
Communicate iiany iiprofessional iilimitations iior iiother iiconstraints iithat iiwould iipreclude iiresponsi-
i i ble iijudgment iior iisuccessful iiperformance iiof iian iiactivity.
6. Service iicompanies iisell iitime, iiskills, iiand iiknowledge. i i Examples iiof iiservice iicompanies iiinclude
iiphone i i service iicompanies, iibanks, iicleaning iiservice iicompanies, iiaccounting iifirms, iilaw iifirms,
iimedical iiphysicians, i i and iionline iiauction iiservices.
7. Merchandising iicompanies iiresell iiproducts iithey iibuy iifrom iisuppliers. iiMerchandisers iikeep iian
iiinventoryof i i products, iiand iimanagers iiare iiaccountable iifor iithe iipurchasing, iistorage, iiand iisale iiof
iithe iiproducts. iiExamples i i of iimerchandising iicompanies iiinclude iitoy iistores, iigrocery iistores, iiand
iiclothing iistores.
8. Merchandising iicompanies iiresell iiproducts iithey iipreviously iibought iifrom iisuppliers, iiwhereas
i i manufacturing iicompanies iiuse iilabor, iiequipment, iisupplies, iiand iifacilities ito iiconvert iiraw
iimaterials iiinto i i new iifinished iiproducts. iiIn iicontrast iito iimerchandising iicompanies, iimanufacturing
iicompanies iihave iia i i broad iirange iiof iiproduction iiactivities iithat iirequire iitracking iicosts iion iithree
iikinds iiof iiinventory.
9. The iithree iiinventory iiaccounts iiused iiby iimanufacturing iicompanies iiare iiRaw iiMaterials iiInventory,
iiWork-in- i i Process iiInventory, iiand iiFinished iiGoods iiInventory.
Raw iiMaterials iiInventory iiincludes iimaterials iiused iito iimanufacture iia iiproduct. iiWork-in-
ProcessInventory i i includes iigoods iithat iihave iibeen iistarted iiin iithe iimanufacturing iiprocess iibut iiare
iinot iiyet iicomplete. i i Finished i i Goods iiInventory iiincludes iicompleted iigoods iithat iihave iinot iiyet
iibeen iisold.
10. A iidirect iicost iiis iia iicost iithat iican iibe iieasily iiand iicost-effectively iitraced iito iia iicost iiobject ii(which iiis
iianything i i for iiwhich iimanagers iiwant iia iiseparate iimeasurement iiof iicost). iiAn iiindirect iicost iiis iia
iicost iithatcannot iibe i i easily iior iicost-effectively iitraced iito iia iicost iiobject.
11. The iithree iimanufacturing iicosts iifor iia iimanufacturing iicompany iiare iidirect iimaterials, iidirect iilabor,
iiand i i manufacturing iioverhead. iiDirect iimaterials iiare iimaterials iithat iibecome iia iiphysical iipart iiof iia
iifinished i i product iiand iiwhose iicosts iiare iieasily iitraceable iito iithe iifinished iiproduct. i i Direct iilabor
iiis iithe iilabor iicost iiof i i the iiemployees iiwho iiconvert iimaterials iiinto iifinished iiproducts. iiManufacturing
iioverhead iiincludes iiall i i manufacturing iicosts iiexcept iidirect iimaterials iiand iidirect iilabor, iisuch iias
iiindirect iimaterials, iiindirect iilabor, i i factory iidepreciation, iifactory iirent, iiand iifactory iiproperty
iitaxes.
