Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual

Preview (16 of 1446 Pages)

100%

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual - Page 1 preview image

Loading page ...

iTABLE OF CONTENTSPrefaceivDedication........................................................................................................................................vSupplements Available for16thEditionviAlternative Suggested Chapter SequencesviiiCategorization of Assignment MaterialxiiPresentation of SolutionsxxviiiMajor Changes in Text for the16thEditionxxixChanges in Assignment Materialfor the16thEditionxxxvChapter Solutions1TheManager and Management Accounting1-12An Introduction to Cost Terms and Purposes2-13Cost-Volume-Profit Analysis3-14Job Costing4-15Activity-Based Costing and Activity-Based Management5-16Master Budget and Responsibility Accounting6-17Flexible Budgets, Direct-Cost Variances, and Management Control7-18Flexible Budgets, Overhead Cost Variances, and Management Control8-19Inventory Costing and Capacity Analysis9-110Determining How Costs Behave10-111Decision Making and Relevant Information11-112Strategy, Balanced Scorecard, and Strategic Profitability Analysis12-113Pricing Decisions and Cost Management13-114Cost Allocation, Customer-Profitability Analysis, and Sales-Variance Analysis14-115Allocation of Support-Department Costs, Common Costs, and Revenues15-116Cost Allocation: Joint Products and Byproducts16-117Process Costing17-118Spoilage, Rework, and Scrap18-119Balanced Scorecard: Quality, Time, and the Theory of Constraints19-120Inventory Management, Just-in-Time, and Simplified Costing Methods20-121Capital Budgeting and Cost Analysis21-122Management ControlSystems, Transfer Pricing, and Multinational Considerations22-123Performance Measurement, Compensation, and Multinational Considerations23-1

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual - Page 2 preview image

Loading page ...

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual - Page 3 preview image

Loading page ...

viALTERNATIVE SUGGESTED CHAPTER SEQUENCESThe Preface toCost Accountingnoted that our aim in organizing the material was to present amodular, flexible organization that permits a course to be custom tailored. This section presentssix possible sequences for a first course in cost accounting. For each of these six sequences, wealso present the sequence of a second course that would result in coverage of many or all of thetopics inCost Accounting. Outlines I–V all include Chapters 1 to 9 in varying orders ofsequence. Outline VI has a strong (almost exclusive) focus on the decision making role of costaccounting.We analyzed the sequences of chapters assigned by many users of the15thedition. Althoughmany instructors tended to follow the sequence in the text, other instructors tailored sequences tofit their particular desires. These tailored sequences varied considerably. By far the most populardeparture was to assign the chapter on process costing (Chapter 17) immediately after thecoverage of job costing (Chapter 4) and activity-based costing (Chapter 5). The next mostpopular departure was to assign Chapter 10 after Chapter 2 or 3. All the accompanyingalternative assignment schedules have an optional provision to facilitate tailoring a course.Obviously, instructors should alter any suggested sequence to suit their preferences.OUTLINE I: This basic course provides a balance of topics between the major purposes of costaccounting:1.Calculating the cost of products, services, and other cost objects2.Obtaining information for planning and control andperformance evaluation3.Analyzing relevant information for making decisionsFinishing the first course with Chapters 11 and 13means that topics with less proceduralemphasis are highlighted in the last weeks of the course; these two chapters also introduce topicscovered in more detail in a second course. Some instructors may assign Chapter 10 without usingthe Appendix on “Regression Analysis,” preferring to delay use of the Appendix until the secondcourse (especially if many students have not been exposed to regression analysis at the time ofthe basic course).OUTLINE II: This basic course covers the same chapters as Outline I but assigns Chapter 10(Determining How Costs Behaves) immediately after Chapter 3 (Cost Volume-Profit Analysis).It also assigns Chapter 12on Strategy, Balanced Scorecard, and Strategic Profitability Analysis.This first part of thesecondcourse emphasizes costmanagementandperformance evaluationbefore covering the six chapters (14–20) on cost allocation and other aspects of costing systems.OUTLINE III:After covering Chapters 1 to 9 and 11 in the basic course, this sequence finisheswith a chapter on strategic issues (Chapter 12) and two chapters on cost allocation topics(Chapters 14 and 15). Some instructors view it as important that studentswho takeonly one costaccounting course become aware of how pervasive cost allocation issues are in practice.

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual - Page 4 preview image

Loading page ...

viiOUTLINE IV: This basic course is similar to Outline II with one key exception:Chapter 17(Process Costing) is covered immediately after Chapter 5. Many instructors prefer to cover jobcosting and process costing in sequence so that their differences are highlighted.OUTLINE V: This basic course emphasizes technical cost accounting topics more than the otherfive outlines. Chapters 17 and 18 extend Chapters 4 and 5; covering 4, 5, 17, and 18 as a singlesection of the course provides students with a solid understanding of product costing alternatives.OUTLINE VI: This basic course is adopted by instructors who wish to put most emphasis on thedecision making and performance evaluation aspects of cost accounting. Finishing the basiccourse with Chapters 22 and 23 means that behavioral issues are highlighted in the final weeks ofthe course.

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual - Page 5 preview image

Loading page ...

viiiOUTLINE IOUTLINE IIOUTLINE IIIBASICCOURSEChapterNumber ofSessionsChapterNumber ofSessionsChapterNumber ofSessions1(1)1(1)1(1)2(2)2(2)2(2)3(2)3(2)3(2)4(3)10(2)4(3)5(3)4(3)5(3)6(2)5(3)6(2)7(2)6(2)7(2)8(2)7(2)8(2)9(2)8(2)9(2)10(2)9(2)11(2)11(2)11(2)12(2)13(2)12(2)14(2)13(2)15(2)Tests(3)Tests(3)Tests(3)Optional(4)Optional(2)Optional(2)323232SECONDCOURSEChapterNumber ofSessionsChapterNumber ofSessionsChapterNumber ofSessions12(3)21(3)10(2)14(2)22(2)13(2)15(2)23(2)21(3)16(2)14(3)15(2)17(2)15(2)17(3)18(2)16(2)18(2)19(2)17(3)19(2)20(2)18(2)20(3)21(2)19(2)22(2)22(2)20(2)23(2)23(2)Tests(3)Tests(3)Tests(3)Optional(6)Optional(6)Optional(6)323232

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual - Page 6 preview image

Loading page ...

ixOUTLINE IVOUTLINE VOUTLINE VIBASICCOURSEChapterNumber ofSessionsChapterNumber ofSessionsChapterNumber ofSessions1(1)1(1)1(1)2(2)2(2)2(2)3(2)3(2)3(2)10(2)4(3)10(2)4(2)5(3)4(2)5(2)17(3)5(2)17(2)18(2)6(2)6(2)6(3)11(2)7(2)7(2)12(2)8(2)8(2)13(3)9(2)9(2)22(2)11(2)23(2)13(2)Tests(3)Tests(3)Tests(3)Optional(4)Optional(4)Optional(5)323232SECONDCOURSEChapterNumber ofSessionsChapterNumber ofSessionsChapterNumber ofSessions12(3)10(2)7(2)21(3)11(2)8(2)22(2)12(2)9(2)23(2)13(3)17(3)14(3)21(3)18(2)15(2)14(2)19(2)16(2)15(2)20(2)18(2)16(2)21(3)19(2)19(2)14(2)20(2)20(2)15(2)22(2)16(2)23(2)Tests(3)Tests(3)Tests(3)Optional(6)Optional(3)Optional(5)323232

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual - Page 7 preview image

Loading page ...

xCATEGORIZATION OF ASSIGNMENT MATERIALThe assignment material in the16thedition has been developed to offerinstructors a broad rangeof options in developing a challenging and interesting course. The following exhibits assistinstructors in selecting assignment material.Exhibits P-l and P-2 show assignment material that is based on serviceornonprofit andonmerchandising(retail, wholesale,or distribution) sectors of the economy.Althoughmany of theassignmentsin the16theditionarebased in the manufacturing sector, Exhibits P-l and P-2provide many examples for instructorswho wish toeither select assignment material from abroad range of sectors orintendto concentrate on sectors outside manufacturing.1.SERVICE AND NONPROFIT SECTORS:These assignments includesettingssuch asaccounting firms, lawfirms, advertising agencies, bank and finance companies, lodgingcompanies, transportation companies, and government agencies2.MERCHANDISING SECTORS:These assignments includesettingssuch as distributors,wholesalers, andretailersThere is growing demand from instructors for assignment material in three specific areas—ethics,globalorinternational,andmoderncostmanagement.ExhibitsP-3toP-5showassignment material in the16thedition on these three topics.3.ETHICS. The second-to-last problem ofmanychapters incorporates an ethical issuefacing a management accountant or a manager. Examples include pressure for cookingthebooks,concealingunfavorableinformation,andconflictsofinterestbetweenmanagement incentives and company values. Many of these problems require students toconsider theIMA Statement of Ethical Professional Practiceon p.17of the text.4.GLOBALANDINTERNATIONAL DIMENSIONS.These assignments includematerialbased outsidethe United States or problems pertaining to companies with operations inmore than onecountry.5.MODERN COST MANAGEMENT FRONTIER IDEAS.These assignments includematerial that an instructor can use to highlight areas such as customer focus, key successfactors,balanced scorecard,value-chain analysis,strategic analysis of operating income,JIT,and continuous improvement. Assignment material related to activity-based costing(ABC), activity-based management (ABM), and cost drivers is found in many chapters.

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual - Page 8 preview image

Loading page ...

xiEXHIBIT P-1ASSIGNMENT MATERIAL FROM SERVICE AND NOT-FOR-PROFIT SECTORSChapterNumberContext11-19Fast-food restaurants; value chain, cost classification1-20Consultationservices; key success factors1-27Windshield replacement; professional ethics1-28Internet company; planning and control1-36Publishing company; ethics; end-of-year actions22-23Marketing research; classification of costs2-26Restaurant; fixed and variable costs2-31Training services; total costs and unit costs33-23Travel agency; CVP analysis3-24Restaurant; CVP analysis3-27Restaurant; CVP analysis3-34Music Society; CVP analysis3-38Tourism; CVP analysis3-39Daycare; CVP analysis,target operating income3-40Marketing;CVP analysis, margin ofsafety3-45Printing Company;Alternative cost structures and sensitivity analysis3-52Museum; gross margin and contribution margin44-23Residential construction; job costing, normal, actual4-26Management consulting firm, job costing4-29University press; jobcosting, journal entries4-33Canadianaccounting firm; actual, normal and variation from normal costing4-34Web-designfirm; actual, normal, and variation from normal costing4-37Law firm; job costing4-38Law firm; job costing4-444-46Printing; allocation and proration of overheadMarket Research; Job costing55-19Testing labs; activity-based costing, cost hierarchy5-20Professional services firm; alternative allocation bases5-24Architectural firm; departmentcosting based on activities5-25Printing company; activity-based costing5-29Custom framing; activity-based costing5-30Banking; activity-based costing, product costing, cross-subsidization5-31Law firm; job costing, single direct-andindirect-cost categories5-32Law firm; job costing, multiple direct-and single indirect-cost categories5-33Law firm; job costing, multiple direct-and indirect-cost categories5-35Lawn care, landscaping; first-stage allocation, ABC5-36Radiology center; department, activity-cost rates

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual - Page 9 preview image

Loading page ...

xii5-39Health care; activity-based costing systemEXHIBIT P-1 (Continued)ChapterNumberContext66-21Environmental testing; sales budget6-28Gutter-cleaning; budgeted cost of jobs6-33Tourcompany; responsibility accounting, stretch targets6-39Restaurant; purchasing agent responsibility accounting77-337-357-46Student loan financing; static and flexible budgetsCleaning service; variance analysisAuto detailing;comprehensive variance analysis88-298-32Food delivery service; overhead variancesFinancialservices; overhead variances8-458-46Foodinspection;non-financial variancesCloud services provider; overhead variances99-45Hospitalchain; cost allocation, downward demand spiral9-46Hospital chain; cost allocation, responsibility accounting, ethics1010-21Delivery; linear cost function10-22Car rental contracts; variable-, fixed-and mixed-cost functions10-27Travel services; estimating a cost function, high-low method10-28Customerservice; estimating a cost function, high-low method10-29Physician services; linear cost approximation10-31Professional services; regression analysis10-36Produce club; high-low method, regression analysis10-37Sports stadium; high-low method, regression analysis10-38Hotel chain; activity-based costing, choosing cost drivers10-39Agricultural transportation; interpreting regression analysis10-42Nonprofit hospital; regression, choosing among models10-43Nonprofit hospital; multiple regression1111-30Convenience store; relevant costs, decision on closing stores11-31Printing press; choosing customers11-32Bakery;relevance of equipment costs11-38Limousine service; opportunity costs, relevant costs11-47Fishing tours; dropping and adding tours1212-29Architecturalfirm; strategy, balanced scorecard12-30Architecturalfirm; strategic analysis ofoperating income12-31Architecturalfirm; analysis of growth, price-recovery, and productivitycomponents12-32Architecturalfirm; identifying and managing unused capacity12-41Cable and internet services; balanced scorecard, socialperformance12-42Airline; balanced scorecard, environmental and social performance

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual - Page 10 preview image

Loading page ...

xiiiEXHIBIT P-1 (Continued)ChapterNumberContext1313-17Tool repair shop; value-added, nonvalue-added costs13-18Architects; target operating income, value-added costs13-22Hotel management; cost-plus target return on investment pricing13-25Hotel; price discrimination13-28Amusement park; value-engineering, target costing, ABC13-30Repair services; cost-plus, time and materials, ethics13-31Temp labor agency; cost-plus and market-basedpricing13-32Testing labs; cost-plus and market-based pricing13-33Recycling; life-cycle costing13-34Airline; price discrimination13-35Airline; anti-trust laws, pricing13-36Interior decoration; preparing a bid, pricing, ethics1414-18Hospitals; cost allocation14-20Repair service; customer profitability14-23Casino; cost allocation to divisions14-25Sports team; variance analysis, multiple products14-33Interior design; customer-cost hierarchy and profitability analysis14-36Insurance Company; cost-hierarchy income statement, allocation ofcorporate costs1515-17Trucking operations; single-rate method, budgeted versus actual costs15-18Trucking operations; dual-rate method, budgeted versus actualcosts15-19Management consulting; direct and step-down support department costallocation15-20Management consulting; reciprocal method support department costallocation15-23Internet and phone services; allocation of common living costs15-24Consulting services; allocation of common travel costs15-29University; fixed cost allocation15-35Hotel; revenue allocation, bundled products15-36Service; direct, step-down, reciprocal support department allocation1717-33Spa;Operation costing1919-23Carwash center; quality improvement, relevant costs and revenues19-25University; waiting time19-26University; waiting time, relevant costs, student satisfaction19-30Pizza delivery; qualityimprovement, Pareto diagram, cause-and-effectdiagram19-36Healthcare group; waiting time, patient satisfaction, compensation

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual - Page 11 preview image

Loading page ...

xivEXHIBIT P-1 (Continued)ChapterNumberContext2121-23Hospital; capital budgeting methods, no income taxes21-24Hospital; capital budgeting methods,income taxes21-2721-2821-31Construction company; payback and NPV methods, no income taxesClinic; DCT, accrual accounting rate of return, working capital, evaluationof performanceDermatology;project choice21-2921-38Bakery; newequipment purchase, income taxesLaundromat; payback methods, even and uneven cash flors21-4021-42Entertainment center; recognizing cash flows for capital investmentprojectsConstruction and mining sales and services; NPV of information system2222-18Hotel chain;benefits and costs of decentralization22-36Composting service; full cost and market-based transfer prices2323-2223-2523-28Educational services; comparison of divisions, DuPont methodReinsurance and financialservices; ROI, RI, EVAVenture capital; Capital budgeting, RI23-34Restaurants; RI, measurement alternatives for performance measures23-36Media group; ROI, RI, DuPont method, investment decisions, balancedscorecard23-37Media group;division managers' compensation, levers of control23-42Health spas; RI, EVA, measurement alternatives, goal congruence

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual - Page 12 preview image

Loading page ...

xvEXHIBIT P-2ASSIGNMENT MATERIAL FROM MERCHANDISING SECTORSChapterNumberContext22-24Entertainment store; classification of costs2-34Department store; cost of goods purchased, cost of goods sold, andincome statement2-35Retail outlet store;cost of goods purchased,cost of goods sold andincome statement33-24Deli sub shop; CVP3-26Cardealer; CVP analysis, income taxes3-28Jeans wholesaler; CVP and sensitivity analysis3-30Rug dealer; space rental terms, operating leverage3-35Men’s clothing retailer; contribution margin, decision making3-37Retail store; decisionmaking under uncertainty, expected value3-43Shoe store; sales commissions, CVP analysis3-44Shoe store; sales commissions, CVP analysis3-46Sunglasses store; CVP, alternative cost structures3-51Luggage carrier retailer; sales mix, CVPanalysis55-27Supermarket; ABC, product-line profitability5-28Furniture wholesaler; ABC, customer profitability5-37Pharmaceuticals distributor; ABC5-43Retail store; activity-based costing and management66-30Convenience storechain; activity-based budgeting6-31Convenience storechain; activity-based budgeting, kaizen budgeting6-34Retail store; cash flow, sensitivity analysis1010-4610-47Fashion store; interpretingregression results, matching time periodsDepartment store chain; cost drivers, ABC, simple regression analysis10-48Department store chain; cost drivers, ABC, multiple regression analysis1111-27Food store; Relevant costs,contribution margin, product emphasis11-30Convenience stores; relevant costs, closing and opening stores11-49Restaurant supply; Dropping a customer, ABC, ethics1212-21T-shirts distributor; strategy, balanced scorecard12-22T-shirts distributor; strategic analysis of operating income12-23T-shirts distributor; analysis of growth, price-recovery,and productivity components12-24T-shirts distributor; identifying and managing unused capacity1313-19Distributor; target prices, target costs, ABC13-21Solar-heating systems seller; target costs, process-design changes

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual - Page 13 preview image

Loading page ...

xviEXHIBIT P-2(Continued)ChapterNumberContext1414-19Environmental productsdistributor; customer profitability, customer-cost hierarchyxx cccvcvc14-21Pharmaceutical distributor; customer profitability14-26Wine glass retailer; variance analysis, multiple products14-31Paperdistributor; customerprofitability1515-21Online book retailer; direct and step-down support department costallocation15-22Online book retailer; reciprocal method support department costallocation15-25Retailer; revenue allocation15-26Auto sales;allocation of common costs15-27Department store; single-rate, dual-rate and practical capacity allocation2020-21Sporting goods retailer; EOQ20-22Sporting goods retailer; EOQ, effect of parameter changes20-23Textile retailer; EOQ20-33Retailer;sensitivity of EOQ to changes in relevant ordering and carryingcosts, cost of prediction error2121-2521-41Soda distributor; Capital budgeting with uneven cash flowsFood retailer; NPV, inflation, income taxes21-42Construction supplier;NPVof information system,income taxes2222-16Convenience storechain;evaluating management control systems,balanced scorecard2323-2123-27Trucking; metrics for driversAutomobile retailer; ROI, RI, EVA23-38Multi-channel sales; Executive compensation, balanced scorecard

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual - Page 14 preview image

Loading page ...

xviiEXHIBIT P-3ASSIGNMENT MATERIAL ON ETHICSChapterNumberContext11-26Division performance1-27Division performance1-34Pharmaceutical company, budgeting1-35Snack foods division;End-of-year actions1-36Consumer magazines;End-of-year actions1-37Furniture manufacturing global company,end-of-year actions22-47Cost classification, ethicssz33-53Environmental costs, CVP analysis,ethics44-45Job costing,ethics55-42Electronics; ABC, implementation, ethics66-46Manufacturer;slack, ethics77-47GPSmanufacturer;price and efficiencyvariances, benchmarking, ethics88-48Overhead variances,ethics99-46Hospital chain; cost allocation, responsibility accounting, ethics1111-49Dropping a customer, activity-based costing, ethics1313-30Repair services; cost-plus, time and materials, ethics13-36Interiordecoration; preparing a bid, pricing, ethics1414-41Writing smaller orders; customer profitabilityand ethics1717-47Rock-crushing plants; benchmarking, ethics1818-45Job costing, classifying spoilage, ethics1919-2019-37Carseats; costs of quality ethicsAuto partsmanufacturer; ethics and quality2020-41Pumpmanufacturer; JIT production, relevant benefits, relevant costs,ethics2222-33Chocolatemanufacturer; transfer pricing, goal congruence, ethics

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual - Page 15 preview image

Loading page ...

xviii2323-41Manufacturer; ethics, levers of controlEXHIBIT P-4ASSIGNMENT MATERIAL WITH GLOBALOR INTERNATIONAL SETTINGChapterNumberContext11-37Contract bidding, ethical and cultural issues33-23Travel agency, CVP analysis3-31International cost structure differences, CVP analysis44-33Canadianaccounting firm; actual, normal and variation from normalcosting66-25Mexico bicyclemanufacturer; revenues, production and purchasesbudgets77-45Memory card manufacturer in Taiwan; direct-cost and selling pricevariances88-28Telecommunications company; manufacturing overhead, standard-costing system1010-39Agricultural transportation in Canada; interpreting regression results1111-36International outsourcing; relevant costs, exchange rates1616-42Flash memory chips manufacturer inTaiwan; joint-cost allocation,process further or sell2121-3421-36Prototype chipmanufacturer;equipment replacement,no income taxesFragrance manufacturer; DCF, sensitivity analysis, no income taxes

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual - Page 16 preview image

Loading page ...

xixEXHIBIT P-4 (Continued)ChapterNumberContext2222-20Multinational computer company;transfer pricing, alternative transfer-pricing methods, global income tax minimization22-2222-2322-30Chainsaw manufacturer;Multinationaltransferpricing, global taxminimizationChainsaw manufacturer; Multinational transfer pricing, global taxminimizationHigh-end fertilizers; multinational transfer pricing, global taxminimization22-32Component manufacturer; international transfer pricing, taxes, goalcongruence2323-29Manufacturing, U.S. and Norway; multinationalperformancemeasurement, ROI, RI23-35Multinational firm,U.S.,France, andAustralia;differing risk,comparison of profit, ROI, and RI

Preview Mode

This document has 1446 pages. Sign in to access the full document!

Report

Study Now!

Document Details

Related Documents

Test Bank For Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition

Horngren's Cost Accounting: A Managerial Emphasis 16th Edition Test Bank

Horngren's Cost Accounting: A Managerial Emphasis, 16th Edition Solution Manual

Accounting Principles II – Traditional Cost Systems

Accounting Principles II – Statement of Cash Flows

Accounting Principles II – Partnerships

Accounting Principles II – Managerial and Cost Accounting Concepts

Accounting Principles II – Long-Term Liabilities

Accounting Principles II – Investments

Accounting Principles II – Incremental Analysis

Company

Explore

Study Tools