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Solution Manual for Managerial Accounting, 6th Edition

Get clear, well-explained answers to your toughest problems with Solution Manual for Managerial Accounting, 6th Edition.

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Solution Manual for Managerial Accounting, 6th Edition - Page 1 preview imageManagerial AccountingSixthEditionKaren Wilken BraunWendy M. TietzInstructor’sSolutionsManualJennifer Allen
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Solution Manual for Managerial Accounting, 6th Edition - Page 2 preview image
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Solution Manual for Managerial Accounting, 6th Edition - Page 3 preview imageContentsChapter 1Introduction to ManagerialAccounting............................................1-1Chapter 2Building Blocks of Managerial Accounting.....................................2-1Chapter 3Job Costing........................................................................................3-1Chapter 4Activity-Based Costing, Lean Operations, and theCosts of Quality..............................................................................4-1Chapter 5Process Costing..................................................................................5-1Chapter 6Cost Behavior.....................................................................................6-1Chapter 7Cost-Volume-Profit Analysis............................................................7-1Chapter 8Relevant Costs for Short-Term Decisions........................................8-1Chapter 9The Master Budget...........................................................................9-1Chapter 10Performance Evaluation.................................................................10-1Chapter 11Standard Costsand Variances.........................................................11-1Chapter 12Capital Investment Decisions and the Time Value of Money........12-1Chapter 13Statement of Cash Flows................................................................13-1Chapter 14Financial Statement Analysis...........................................................14-1Chapter 15Sustainability....................................................................................15-1
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Solution Manual for Managerial Accounting, 6th Edition - Page 4 preview image1-1Chapter 1Introduction to Managerial AccountingQuick CheckAnswersQC1-1. cQC1-2. dQC1-3. bQC1-4. dQC1-5. dQC1-6. cQC1-7. aQC1-8. cQC1-9. bQC1-10. aQC1-11. cQC1-12. bShort Exercises(5–10 min.)S1-1a.Planningb.Controllingc.Directingd.Directinge.Directing, Controlling(5–10 min.)S1-2a.Financial accountingb.Financialaccountingc.Financialaccountingd.Managerialaccountinge.Managerial accountingf.Managerialaccountingg.Financial accountingh.Financial accountingi.Managerialaccountingj.Managerial accountingk.Financialaccountingl.Managerial accountingm.Financial accounting
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Solution Manual for Managerial Accounting, 6th Edition - Page 5 preview imageManagerial Accounting 6e Solutions Manual1-2(5–10 min.)S1-3a.Internal Auditing Departmentb.Controllerc.Internal Auditing Departmentd.Internal Auditing Departmente.Treasurerf.Controllerg.Controllerh.Controlleri.Controllerj.Controllerk.Controllerl.Treasurerm.Treasurer(5–10 min.)S1-4CharacteristicCheck (√) if related to internalauditinga.Reports directly to the audit committee√b.Reports to treasurer or controllerc.Is part of the Accounting Departmentd.Helps to ensure that company’s internal controls are functioningproperly√e.Performs the same function as independent certified publicaccountantsf.Usually reports to a senior executive (CFO or CEO) for administrativematters√g.External audits can be performed by the internal auditing departmenth.Required by theNew York Stock Exchange if company stock is publiclytraded on the NYSE√i.Ensures that the company achieves its profit goals
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Solution Manual for Managerial Accounting, 6th Edition - Page 6 preview imageChapter 1Introduction to Managerial Accounting1-3(10 min.)S1-5a.The CEO is hired by theboardofdirectors.b.A subcommittee of the board of directors is called theaudit committee.c.Raising capital and investing funds are the direct responsibilities of thetreasurer.d.TheCFOand theCOOreport to the CEO.e.Financial accounting, managerial accounting, and tax reporting are the direct responsibilities of thecontroller.f.Management accountants often workoncross-functional teams.g.The internal audit function reports to the CFO or theCEOand theaudit committee.h.The company’s operations are the direct responsibility of theCOO.(5 min.)S1-61.The Institute of Management Accountants(IMA) issues theCertified Management Accountant (CMA)certification.2.Thecertification offered by IMA,focuses onaccountingandfinancetopics.3.The monthly professional magazine published by the Institute of Management Accountants is calledStrategicFinance.4.The certification launched in 2012 jointly by the American Institute of Certified Public Accountants(AICPA) andthe Chartered Institute of Management Accountants(CIMA)is called theChartered Global ManagementAccountant(CGMA).5.To earn CMA certification, a candidate must have a(n)baccalaureatedegree.The CMA exam can be taken,however, before finishing this degree.(5 min.)S1-7a.Failing to provide job description information to management because you fear it may be used to cut a positionin your department violates thecredibilitystandard.b.Providing earnings information to your sisterbefore it is publicly announced violates theconfidentialitystandard.c.Failing to read the specifications of the software package before purchasing it violates thecompetencestandard.d.Stealing from your employer is a violation of theintegritystandard.e.Skipping continuing education sessions could violate the requirement to maintainprofessionalcompetence. Ifyour company paid for you to attend the conference, skipping the sessions also violates theintegritystandard.
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Solution Manual for Managerial Accounting, 6th Edition - Page 7 preview imageManagerial Accounting 6e Solutions Manual1-4(5 min.)S1-8a.Sustainabilityb.Sarbanes-Oxley Act (SOX)c.Enterprise resourceplanning (ERP) systemd.Data analytics(5 min.)S1-9LetterScenarioStandard violateda.Jack, an accountant for a smartphone manufacturer, told hisfriendsabout a new model of smartphone being released by the company in thefollowing quarter. For competitive reasons, the company keeps itsmodels shrouded in secrecy until release date.Confidentialityb.The CFO directed that certainexpenses be reclassified as assets, so thattarget profit could be achieved.The CFO rationalized that jobs would besaved by reaching the targeted income figures.Integrityc.Even though Meagan's company is adoptinga new ERP system thatimpacts the accounting system,Meagan(a management accountant) hasnot completed the requiredERPtrainingfrom the vendor.Competenced.Oliverprovides an analysis of the profitability of a company-owned storethat is managed by Oliver’s best friend, Bob.Oliverneglects to includeallocatedfixedcosts inBob’sreport.If Oliverincludes those allocatedfixed costs, the store will show a lossand Bob’s job could be in danger.Credibilitye.Yimeng, apurchasing agent for hercompany, received two tickets from asupplier to the upcoming Ohio State versusUniversity of Michiganfootball game.These tickets sell for over $500each.Integrity(10 min.)S1-10a.Financial accounting systemb.Critical thinkingc.IMAd.Treasurere.Economic, environmental, and socialf.Controllerg.Internal audith.Sarbanes-Oxley Act of 2002i.Triple Bottom Linej.Controllingk.Directingl.ERPm.Sustainabilityn.CEOo.Planningp.CFO
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Solution Manual for Managerial Accounting, 6th Edition - Page 8 preview imageChapter 1Introduction to Managerial Accounting1-5(5min.)S1-11a.Descriptiveb.Descriptivec.Prescriptived.Diagnostice.Predictivef.Diagnosticg.Adaptive andAutonomous(10 min.)S1-12ItemTermDefinition1.Adaptive and autonomousanalyticsk. Analytics that collect,analyze, learn, and adjust without humanintervention.2.Big datad. Data characterized by five Vs: volume, velocity, variety, veracity,and value.3.Categorical (nominaldata)h. Data that represents things that have no numerical value (such ascustomer name, state, and distribution channel).4.Datai. A collection of observations.5.Data analyticsb. The process of turning raw data into actionable insights that lead togood business decisions.6.Data visualizationj. The art and science of communicating quantitativeinformationthrough visual presentations.7.Descriptive analyticsm. Analytics that describe what has or is happening.8.Diagnostic analyticsf. Analytics that help uncover the root cause of the current state.9.Ordinal datac. Data that has a clearly defined order and may or may not havenumbers associated with it (such as customer satisfaction rankingsand employee rank).10.Predictive analyticsg. Analytics that seek to predict what will happen in the future.11.Prescriptive analyticsa. Analytics that seek to determine what should be done.12.Quantitative datan. Data that can be measured, counted, and aggregated (such as salesrevenue, number of customers, and cost of product).13.Structured datal. Data that is highly organized into predefined discreet categories,often contains labels, and is fairly easy to search and manipulate.14.Unstructured datae. Data that is not organized into predefined categories.
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Solution Manual for Managerial Accounting, 6th Edition - Page 9 preview imageManagerial Accounting 6e Solutions Manual1-6(10 min.)S1-13ItemTaskScreenshot letter1.Format asaccountingnumberK2.Insert new workbookI3.Insert functionD4.Worksheet nameH5.Decrease decimalJ6.Active cellE7.RibbonA8.Name of workbook (file name)G9.Cell referenceC10.Formula barF11.Name boxB(10 min.)S1-14TaskDescription of how to do the task in Excel (Windows)1.Change the order of the worksheets in theworkbookc. Drag and drop worksheet to desired location.2.Copy and paste the contents of one cell to anothercellj. In the first cell, hold down Ctrl + C, then navigate tothe desired cell and hold down Ctrl + V.3.Copy the contents of a cell to a range of cella. Drag the fill handle down the column or across therow.4.Go to the end of the data set in a worksheetg. Hold down the Ctrl and End keys simultaneously.5.Move between worksheetsi. Click on a worksheet tab.6.Refer to a cell as an absolute referenced. Put dollar signs in front of both the column and rowreference in the formula.7.Rename a worksheeth. Right click worksheet tab and select option to give theworksheet a new name.8.Select a range of cellsb. Click on the first cell in a range and drag your cursor tothe final cell you are selecting.9.Select all data in aworksheete. Hold down the Ctrl and A keys simultaneously.10.Select one cellf. Click on a cell.
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Solution Manual for Managerial Accounting, 6th Edition - Page 10 preview imageChapter 1Introduction to Managerial Accounting1-7(10 min.)S1-15a.=B2*C2b.Drag the cell handle in the lower right corner of Cell D2 down to Cell D5.c.=SUM(B2:B5)d.=SUM(D2:D5)e.=B2+B4f.=D2+D4g.=B10/B9h.=B3-B5i.=D3-D5(10 min.)S1-16a.To quickly navigate to the end of the data in a worksheet when using Excel in a Windowsenvironment, use theCtrl + Endkeystrokes.b.The top bar in an Excel workbook that contains File, Home, Insert, and other tabs is called theribbon.c.File, Home, Insert, Page Layout, Formulas, and Data are examples oftabs.d.Theformula bardisplays how the content of the active cell was generated.e.To select all data in a worksheet when using Excel in a Windows environment, use theCtrl + Akeystrokes.f.The worksheet tab is right clicked torenameit.g.Theactive cellwill have a colored border around it and the cell reference will appear in the namebox.h.A unique address for each cell in an Excel worksheet is called acell reference.i.The cell reference for the active cell will appear in thename box.j.To quickly navigate to the first column of a row in Excel when using Excel in a Windowsenvironment, use theCtrl + arrow leftkeystrokes.k.There are separate tabs for eachworksheetin a workbook.
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Solution Manual for Managerial Accounting, 6th Edition - Page 11 preview imageManagerial Accounting 6e Solutions Manual1-8Exercises (Group A)(10 min.)E1-17Aa.Information on a company’s past performance is provided to external parties byfinancial accounting.b.Managerial accountingsystems are chosen by comparing the costs versus the benefits of the system and arenot restricted by GAAP(or International Financial Reporting Standards,IFRS, in the case of companiesheadquartered in many countries outside of the United States).c.Managerial accountingsystems report on various segments or business units of the company.d.Financial accounting develops reports for external parties such ascreditorsandshareholders.e.When managers evaluate the company’s performance compared to the plan, they are performing thecontrollingrole of management.f.CPAs audit thefinancial accountingstatements of public companies.g.Companies must follow GAAP(orInternational Financial Reporting Standards,IFRS, in the case of companiesheadquartered in many countries outside of the Unites States)in theirfinancial accountingsystems.h.Choosing goals and the means to achieve them is theplanningfunction of management.i.Decision makers inside a company are themanagers.(10 min.)E1-18Aa.Technicalb.Nontechnicalc.Technicald.Nontechnicale.Nontechnicalf.Nontechnicalg.Technicalh.Technicali.Technicalj.Technicalk.Nontechnicall.Nontechnicalm.Technicaln.Nontechnicalo.Technicalp.Technicalq.Nontechnicalr.Nontechnicals.Technicalt.Nontechnical
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Solution Manual for Managerial Accounting, 6th Edition - Page 12 preview imageChapter 1Introduction to Managerial Accounting1-9(10 min.)E1-19A1.Financial accounting information2.Managerialaccounting information3.Financial accounting information4.Financial accounting information5.Managerialaccounting information6.Financial accounting information7.Both8.Financialaccounting information9.Financial accounting information10.Financial accounting information11.Both12.Both13.Financial accounting information14.Financialaccounting information(10 min.)E1-20A1.Confidentiality2.Credibility3.Credibility4.Credibility5.Confidentiality6.Confidentiality7.Integrity8.Competence9.Competence10.Competence11.Integrity12.Integrity13.Competence(10 min.)E1-21AExpected benefit (cost savings)Wages (20 workers x 40hrs.x $15/hr.)$12,000Payroll taxes ($12,000 x 7.65%)918Totalexpected cost savings$12,918Expected costsLettuceBot cost (machine cost)$8,000LettuceBot delivery cost500Cost of operating the lettuce bot1,500Total expected costs$10,000Net expected benefit in first year$2,918
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Solution Manual for Managerial Accounting, 6th Edition - Page 13 preview imageManagerial Accounting 6e Solutions Manual1-10(10 min.)E1-22Aa.Economicb.Socialc.Environmentald.Sociale.Environmentalf.Socialg.Economich.Environmentali.Environmentalj.Socialk.Sociall.Socialm.Socialn.Environmental(10 min.) E1-23Aa.Categoricalb.Ordinalc.Categoricald.Quantitativee.Quantitativef.Ordinalg.Quantitativeh.Ordinali.Categoricalj.Quantitativek.Categoricall.Ordinal
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Solution Manual for Managerial Accounting, 6th Edition - Page 14 preview imageChapter 1Introduction to Managerial Accounting1-11(20 min.) E1-24AExcel file should show:Formulas in each cell should be:
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Solution Manual for Managerial Accounting, 6th Edition - Page 15 preview imageManagerial Accounting 6e Solutions Manual1-12(10 min.) E1-25A1.9852.MD-Disability3.3894.35.499266.See belowa.$636.10b.12c.$7,633.207.808408.Click in the cell in the upper left corner of the worksheet (theintersection of the row and column headers)
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Solution Manual for Managerial Accounting, 6th Edition - Page 16 preview imageChapter 1Introduction to Managerial Accounting1-13(10 min.) E1-26AExcel file should show:
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Solution Manual for Managerial Accounting, 6th Edition - Page 17 preview imageManagerial Accounting 6e Solutions Manual1-14(continued) E1-26AFormulas in each cell should be:
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Solution Manual for Managerial Accounting, 6th Edition - Page 18 preview imageChapter 1Introduction to Managerial Accounting1-15Exercises (Group B)(5 min.)E1-27Ba.U.S. companies must follow GAAP(or International Financial Reporting Standards,IFRS, in the case of companiesheadquartered in many countries outside of the United States)in theirfinancial accountingsystems.b.Financial accounting develops reports for external parties, such ascreditorsandshareholders.c.When managers evaluate the company’s performance compared to the plan, they are performing thecontrollingrole of management.d.Managersare decision makers inside a company.e.Financial accountingprovides information on a company’s past performance to external parties.f.Managerial accountingsystems are not restricted by GAAP(orInternational Financial Reporting Standards,IFRS,in the case of companies headquartered in many countries outside of the United States)but are chosen bycomparing the costs versus the benefits of the system.g.Choosing goals and the means to achieve them is theplanningfunction of management.h.Managerial accountingsystems report on various segments or business units of the company.i.Financial accountingstatements of public companies are audited annually by CPAs.(5–10 min.)E1-28Ba.Nontechnicalb.Nontechnicalc.Nontechnicald.Technicale.Nontechnicalf.Technicalg.Technicalh.Technicali.Nontechnicalj.Technicalk.Nontechnicall.Technicalm.Nontechnicaln.Technicalo.Technicalp.Technicalq.Technicalr.Nontechnicals.Nontechnicalt.Nontechnical
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Solution Manual for Managerial Accounting, 6th Edition - Page 19 preview imageManagerial Accounting 6e Solutions Manual1-16(5–10 min.)E1-29B1.Both2.Financial accounting information3.Financial accounting information4.Managerial accounting information5.Financial accounting information6.Managerial accounting information7.Financial accounting information8.Financial accounting information9.Financial accounting information10.Financial accounting information11.Both12.Both13.Financial accounting information14.Financial accounting information(10 min.)E1-30B1.Credibility2.Competence3.Integrity4.Competence5.Integrity6.Credibility7.Confidentiality8.Competence9.Integrity10.Confidentiality11.Credibility12.Confidentiality13.Competence(10 min.)E1-31BExpected benefit (cost savings)Wages (25 workers x 50hrs.x $15/hr.)$18,750Payroll taxes ($18,750 x 7.65%)1,434Total expected cost savings$20,184Expected costsLettuce bot cost (machine cost)$9,500Lettuce bot delivery cost1,000Cost of operating the lettuce bot2,500Total expected costs$13,000Net expected benefit in first year$7,184
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Solution Manual for Managerial Accounting, 6th Edition - Page 20 preview imageChapter 1Introduction to Managerial Accounting1-17(10 min.)E1-32Ba.Socialb.Environmentalc.Environmentald.Economice.Environmentalf.Socialg.Environmentalh.Sociali.Environmentalj.Socialk.Economicl.Socialm.Environmentaln.Social(10 min.) E1-33Ba.Categoricalb.Quantitativec.Categoricald.Categoricale.Ordinalf.Ordinalg.Quantitativeh.Ordinali.Quantitativej.Categoricalk.Quantitativel.Ordinal
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Solution Manual for Managerial Accounting, 6th Edition - Page 21 preview imageManagerial Accounting 6e Solutions Manual1-18(20 min.) E1-34BExcel file should show:Formulas in each cell should be:
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Solution Manual for Managerial Accounting, 6th Edition - Page 22 preview imageChapter 1Introduction to Managerial Accounting1-19(10 min.) E1-35B1.3862.NJ-Disability3.6934.95.575166.See belowa.$679.55b.12c.$8,154.597.562438.Click in the cell in the upper left corner of the worksheet (the intersection of the row and column headers)
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Solution Manual for Managerial Accounting, 6th Edition - Page 23 preview imageManagerial Accounting 6e Solutions Manual1-20(10 min.) E1-36BExcel file should show:
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Solution Manual for Managerial Accounting, 6th Edition - Page 24 preview imageChapter 1Introduction to Managerial Accounting1-21(continued) E1-36BFormulas in each cell should be:
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Solution Manual for Managerial Accounting, 6th Edition - Page 25 preview imageManagerial Accounting 6e Solutions Manual1-22Problems (Group A)(45–60 min.)P1-37AReq. 1PlanningDirectingControllingSalesIncreasesalesSetting competitive prices.Examine sales reports.Monitor sales numbers andprices from different productsand locations over time.Investigate variances.RepairsIncreasevolume ofrepairsStreamline process to save time.Setcompetitive prices; generate reportsshowing time used for each type ofrepair.Track total number of repairsand see if more repairs arebeing made and if time isutilized efficiently.LessonsIncreasenumber oflessons givenFind out what customers want and need.Observe competitors for prices andlessons offered.Improve teacherqualifications.Examine number of lessonsgiven per instrument.WebdevelopmentIncreaseWebtrafficImprove design of website.Offer moreproducts online.Make shopping easierand more intuitive.Increase marketingefforts.MonitorWeb traffic by havingan online counting device.Lookat sales numbers to see ifpeople are just surfing oractually buying merchandise.AccountingImplement ERPsystem tomonitordepartmentactivities andrecord financesTrain employees on new system.Findpotential flaws in the system and fixbefore implementation.Track employee work schedulesto stay on time.Double-checkentries to ensure system isworking properly.HumanresourcesDecreaseemployeeturnoverHire employeeswhoare “a good fit” forthe company.Raise employee morale; set clear jobdescriptions.Give feedback toemployees.Monitor bothinvoluntary andvoluntary turnover.Interviewemployees to determinepotential problems with theworkplace.
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Solution Manual for Managerial Accounting, 6th Edition - Page 26 preview imageChapter 1Introduction to Managerial Accounting1-23(continued)P1-37AReq. 2PlanningDirectingControllingSalesA sales budget for theentire company and eachindividual product at eachlocation is needed.Analyze sales reports tomonitor type and amount ofsales made.Prices would beanalyzed using these reportsand market analysis ofcompetitors.Compare budgets with actualsales numbers.Investigatevariances to take correctiveactions if needed.Changeprices if deemed appropriate.RepairsLabor budgets would beneeded to determine thetime taken to repairinstruments and if hiringmore repair staff would befeasible.Employee training programswould be used.Monitor timetaken per repair for eachmember of repair staff.Compare budgets with actualresults.Investigate variancesand take corrective action ifneeded.LessonsBudgets for types oflessons offered, timeneeded per lesson taught,and market analysis todetermine which lessonspotential customers want.Ensure customer satisfactionby hiring qualified staff.Analyze market analysis todetermine market needs andproper pricing schemes.Compare budgets with actualresults.Use customerfeedback to improve lessons.Make changes if needed.WebdevelopmentAn expense budget isneeded to ensure money isspent efficiently.A budgetwould also be needed tosetWeb traffic goals.Monitor department expensesand website visits using onlinecounting program.Compare budgeted expenseswith actual and compareexpectedWeb traffic withactual.Investigate variancesand make changes as needed.AccountingTime budgets as well asexpense budgets areneeded.Train employees on newsystem to keep within timebudget.Monitor expensesclosely.Compare budget with actualnumbers.Investigatevariances and make changes ifneeded.HumanresourcesEmployee satisfactionsurveys andfeedbackreports.Active relationship betweenmanagement and employees.Management would recordneeds and suggestions madeby employees in feedbacksystem.Consider employeesuggestions and enactchanges if needed.Note:All the information needed inthe table above would be generated almost entirely by the managerial accountingsystem. Managerial accounting systems provide much of the information needed for internal decision making, whilefinancial accounting systems are geared towards external financial reporting.
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Solution Manual for Managerial Accounting, 6th Edition - Page 27 preview imageManagerial Accounting 6e Solutions Manual1-24(15–20 min.)P1-38Aa.If the goods have been received, postponing recording of the purchases understates liabilities. This is unethicaland inconsistent with the IMA standards even if the supplier agrees to delay billing.b.Thesoftware has not been sold. Therefore, it would be inconsistent with the IMA standards to record it as sales.c.Delaying year-end closing incorrectly records next year’s sales as this year’s sales. This is clearly wrong andunethical, and it is inconsistent with the IMA standards.d.The appropriate allowance for bad debts is a difficult judgment. The decision should not be driven by the desireto meet a profit goal. It should be based on the likelihood that the company will collect. We cannot determinethis without more information. However, because the company emphasizes earnings growth, which can lead tosales to customers with weaker credit records, reducing the allowance seems questionable. This strategy is likelyinconsistent with the IMA standards.e.If the maintenance is postponed, there is no transaction to record. This strategy is beyond the responsibility ofthe controller, so it does not violate IMA standards.Strategies a, b, and c are clearly unethical and inconsistent with the IMA standards of integrity, credibility, and perhapscompetence. Strategy d is likely unethical, but we cannot be certain without more information. The controller shouldresist attemptsto implement a, b, and c, and she should gather more information about d. If the president ignores thecontroller’s concerns and still insists that these strategies be implemented, then the controller should probably resignrather than continuing to workfor a company that engages in unethical behavior.
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Solution Manual for Managerial Accounting, 6th Edition - Page 28 preview imageChapter 1Introduction to Managerial Accounting1-25(15–20 min.)P1-39AReq. 1Benefits if the project is successful:Savings from more efficient order processing…………………………$105,000Savings from streamlining the manufacturing process………………125,000Savings from inventory reduction………………………………………..225,000Profits fromincreased sales...........……………………………………....155,000Total benefits if the project is successful………………………………$610,000Req. 2Costs of implementing the project:Software costs………………………………………………………………….$435,000Customizing ERP and loadingdata……………………...…………………95,000Employee training……………………………………………………………..105,000Total costs…………………………………..…………………………………..$635,000Now compare the value of benefits to the costs:Expectedbenefits…………..................................................$610,000Expected costs...……………………………..........................(635,000)Net benefits (costs)…………..…...…………………………...$(25,000)Becausethe expected value of the benefitsislessthan the total costs, the company shouldnotundertake the project.Req. 3The CEO formed a team to evaluate the feasibility of installing an ERP system for two reasons. First, the project wasprobably too big for one person. Second, representatives of the different functional business areas have differentknowledge and information to contribute.a.Estimating software costssystems specialistb.Estimating cost of loading data into the new ERP systemmanagement accountantsystems specialistc.Customize the ERP softwaremanagement accountantsystems specialistd.Estimate customization costsall team memberse.Estimate training costshuman resource directorf.Savings from moreefficient order processingsystems specialistmanagement accountantg.Savings from streamlining the manufacturing processplant engineerplant foremanh.Evaluate the effects of integrating purchasing, production,marketing, and distribution into asingle systemplant foremani.Estimate increase in sales from higher customersatisfactionmarketing directorj.Estimate benefits and costsall team membersStudentanswersmay vary. The main point is that different team members contributedifferent knowledge.
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Solution Manual for Managerial Accounting, 6th Edition - Page 29 preview imageManagerial Accounting 6e Solutions Manual1-26(10–15 min.)P1-40ACosts:Financial assistance to dealers...............…………..$760,000Computer hardware upgrade…………………..........160,000Software and consulting fees………………………..220,000Totalcosts...........................………………………............$1,140,000Value of benefits (lower labor costs)………….………..$1,340,000Total costs...............................………………………….…(1,140,000)Excess of benefits overcosts……………………………$200,000Because the benefits exceed the costs, a cost-benefit analysis suggests that the company should proceed with theonlineordering system.(20–25 min.)P1-41AReq. 1The expected value of the benefits is the labor cost savings of $935,000.This is adownward revision from what wasoriginally estimated in P1-28A.Req. 2Expected value of benefits……….……………............$935,000Total costs (from P1-28A)………………...…………….(1,140,000)Netcost..........................…………………………………$ (205,000)The revised estimates mean the expected costs are greater than the expected benefits.The quantitative analysissuggests that the company should not undertake the project. Beforedeciding, the company should carefully considerother factors like those listed inReq. 3.Req. 3Other factors management should consider before making afinal decision includethe following:•The difficulty and costs of laying off employees may reduce the expected benefits.•Employee layoffs may hurt morale and efficiency in other areas of the company, thus increasing costs.•Electronic order processing should reduce human errors, thereby reducing costs.•Providing dealers with current availability, price information, and timely order processing will help the companymanage and reduce its inventories.StudentanswerstoReq. 3may vary.
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Solution Manual for Managerial Accounting, 6th Edition - Page 30 preview imageChapter 1Introduction to Managerial Accounting1-27Problems (Group B)(45–60 min.)P1-42BReq. 1PlanningDirectingControllingSalesIncreasesalesSetting competitive prices.Examine sales reports.Monitor sales numbers andprices from different productsand locations over time.Investigate variances.RepairsIncrease volumeof repairsStreamline process to save time.Set competitive prices; generatereports showing time used foreach type of repair.Track total number of repairsand see if more repairs arebeing made and if time isutilizedefficiently.CustomizationIncrease numberof custom systemsbuiltFind out what customers wantand need.Observe competitorsfor prices and options offered.Improve employee certificationand offer higher-quality parts.Examine number of computersystems built per type(multimedia, gaming, etc.).WebdevelopmentIncreaseWebtrafficImprove design of website.Offer more products online.Make shopping easier and moreintuitive.Increase marketingefforts.MonitorWebtraffic by havingan online counting device.Lookat sales numbers to see ifpeople are just surfing oractually buying merchandise.AccountingImplement ERPsystem to monitordepartmentactivities andrecord financesTrain employees on new system.Find potential flaws in thesystem and fix beforeimplementation.Track employee work schedulesto stay on time.Double checkentries to ensure system isworking properly.HumanresourcesDecreaseemployeeturnoverHire employeeswhoare “a goodfit” for the company.Raise employee morale; setclear job descriptions.Givefeedback to employees.Monitor both involuntary andvoluntary turnover.Interviewemployees to determinepotential problems with theworkplace.
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Solution Manual for Managerial Accounting, 6th Edition - Page 31 preview imageManagerial Accounting 6e Solutions Manual1-28(continued)P1-42BReq. 2PlanningDirectingControllingSalesHaaswould need a salesbudget for the entire companyand each individual product ateach location.Analyze sales reports to monitortype and amount of sales made.Prices would be analyzed usingthese reports and marketanalysisof competitors.Compare budgets withactual sales numbers.Investigate variances totake corrective actions ifneeded.Change prices ifdeemed appropriate.CustomizationBudgets for types of computersoffered, time needed per job,and market analysis todetermine which computerspotential customers want.Ensure customer satisfaction byhiring qualified staff. Researchquality of available parts. Analyzemarket analysis to determinemarket needs and proper pricingschemes.Compare budgets withactual results.Use customerfeedback to improvecustom builds.Makechanges if needed.RepairsLabor budgets would beneeded to determine the timetaken to repair instrumentsand if hiring more repair staffwould be feasible.Employee training programswould be used.Monitor timetaken per repair for eachmember of repair staff.Compare budgets withactual results.Investigatevariances and takecorrective action if needed.WebdevelopmentHaaswould need an expensebudget to ensure money isspent efficiently.A budgetwould also be needed to setWeb traffic goals.Monitor department expensesand website visits using onlinecounting program.Compare budgetedexpenses with actual andcompare expectedWebtraffic with actual.Investigate variances andmake changes as needed.AccountingHaaswould need time budgetsas well as expense budgets.Train employees on new systemto keep within time budget.Monitor expenses closely.Compare budget withactual numbers.Investigatevariances and makechanges if needed.HumanresourcesEmployee satisfaction surveysand feedback reports.Active relationship betweenmanagement and employees.Management would recordneeds andsuggestions made byemployees in feedback system.Consider employeesuggestions and enactchanges if needed.Note:All the information needed in the table above would be generated almost entirely by the managerialaccounting system. Managerial accounting systems provide much of the information needed for internal decisionmaking, while financial accounting systems aregeared toward external financial reporting.
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Subject
Biology
Textbook
Biology: How Life Works by James Mo...

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