Solutions and Test Bank For Managerial Accounting for Undergraduates 2nd Edition by Christensen PDF

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Test Bank, Solutions Manual, ebook For Managerial Accounting for Undergraduates 2nd Edition by Christensen, Hobson, Wallace, Matthews ; 9781618533098...

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For All Chapters : [email protected]

Chapter 1 Overview of Managerial Accounting QUESTIONS 1.

As opposed to financial accounting, which focuses on reporting a company’s financial performance to external parties, managerial accounting plays a vital role in internal decision making. Managerial accounting also helps top management make decisions regarding future performance, whereas financial accounting measures and reports the financial results of a business’ past actions.

2.

Financial accounting produces reports relevant to stockholders and other external stakeholders in the company, such as creditors and regulators.

3.

Because the product is new and the budget relates to future performance, the owner should ask the management accountant for assistance.

4.

The three types of business entities are manufacturing firms, merchandising firms, and service firms. Manufacturing firms convert materials into finished products through the use of human labor, utilities, and factory assets. Merchandising firms purchase finished products from manufacturers for warehousing, display, and sale to consumers. Service firms perform services, such as healthcare, legal, and accounting services, to customers.

5.

Merchandising firms purchase the finished products, in large quantities, that manufacturing firms produce, and sell and ship them in smaller quantities to consumers.

6.

While this question can lead to any number of answers, examples include Boeing (manufacturing), Costco (merchandising), or Wells Fargo (service).

7.

A manufacturing cell is an interconnected unit that allows an automated flow of product through a manufacturing system. All of the machines within each cell are controlled by a computer, and the functions performed within the cell can be changed quickly by changing the computer program that controls the process. A cell in this arrangement differs from a traditional manufacturing operation because a traditional relies on direct labor and tends to produce more defective units.

8.

Stand-alone automation is a form of factory automation that incorporates a robot or computer-controlled machine into an existing manufacturing process to perform a single function. Flexible-manufacturing-system automation is a form of factory automation that involves multiple cells of two or more automated machines.

Solutions Manual, Chapter 1

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For All Chapters : [email protected] 9.

Just-in-time inventory systems seek to reduce (or eliminate) safety stock balances, minimizing the costs associated with carrying inventories. Just-in-time inventory systems place the burden of carrying safety stock on the company’s suppliers.

10.

Lean manufacturing is a continuous attempt to eliminate waste from all business processes, such as design, manufacturing, distribution, and customer service, without reducing productivity.

11.

Fezzari is a manufacturing firm that uses primarily a consumer-direct approach, selling mainly through web-based orders.

12.

The advantages of Fezzari’s business model include tailoring the bikes they sell to each customer, with body measurements, age, type of riding, and experienced injuries all taken into account. In addition, Fezzari can keep a minimal quantity of parts in inventory.

13.

Environmental Business Consultants, LLC primarily obtains its client work through requests from clients for whom the firm has worked for many years and also by responding to competitive requests for proposals issued

14.

Examples include management accountant, controller, chief financial officer, treasurer, budget analyst, internal auditor, environmental accountant, and tax consultant.

15.

It is relevant because upwards of 90% of those who begin their careers in public accounting will leave public accounting and join a company in business or industry within a few years after graduation.

16.

Most accountants work in industry, due to the number of positions and opportunities available to accountants. Virtually every business needs accountants and their unique skills.

17.

The graduate must take a four-part exam administered by the AICPA, which exam covers Auditing and Attestation, Business Environment and Concepts, Financial Accounting and Reporting, and Regulation. The graduate must then obtain licensure by a state, which usually requires 150 hours of college credit plus real-world work experience.

18.

No, an individual can obtain multiple professional certifications. For example, an accounting graduate can become both a Certified Public Accountant and a Certified Management Accountant.

19.

Career paths include budget analyst, corporate accounting manager, university professor, and finance director.

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Managerial Accounting for Undergraduates, 2nd Edition

For All Chapters : [email protected]

EXTENDING YOUR KNOWLEDGE EYK1-1. a. Many merchandisers in the model industry may value higher-quality products over inexpensive products. In addition, Model may be building its brand name and company image as a high-quality producer, which can create customer loyalty and generate higher profits in future years. b. More likely, because a merchandising company would have a need for more models over a longer period of time than would an individual customer. A customer may buy one or two models from the merchandiser, but the merchandiser would buy thousands of models from a manufacturing company, thus justifying the need for long-term contracts.

EYK1-2. a. It is cheaper to buy manufactured goods in large quantities. To encourage higher volumes of sales, manufacturers usually provide volume discounts to merchandisers who wish to buy large quantities, as an incentive to facilitate ordering large quantities. b. A merchandiser would operate online to lower fixed costs, such as rent, utilities, and other costs associated with the maintenance and upkeep of a building. It also allows the company more flexibility in reaching a broader customer base, as customers do not have to travel to a physical location to purchase the merchandiser’s product. An online presence can eliminate the need to have a physical store, although warehouses or other storage facilities would be needed to house the merchandiser’s products.

EYK1-3. a. Costs to consider include employee salaries, rent, utilities, transportation, computers, marketing, and supplies. b. Accounting for Superior’s operations is different because it does not involve the flow of a physical product. A manufacturing firm will accumulate costs as its products flow through its production, and a merchandising firm will accumulate costs as it purchases product from the manufacturing firms. Service firms, in contrast, accumulate costs as services are performed. While Superior will share many costs in common with Model and Masterful, it will also incur the costs of salaries for professionals and costs associated with service calls.

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For All Chapters : [email protected] EYK1-4. See https://www.businessinsider.com/how-nike-solved-its-sweatshop-problem-2013-5 for NIKE history Note that being a good citizen means doing more than just what you are legally obligated to do. While Peach may not be legally obligated to make sure factory conditions are proper and child labor is not being used, Peach’s customers may think otherwise. NIKE took a significant financial hit because of child labor in factories not owned by NIKE.

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Managerial Accounting for Undergraduates, 2nd Edition...