Managerial Accounting , 8th Edition Solution Manual

Preview (16 of 653 Pages)

100%

Managerial Accounting , 8th Edition Solution Manual - Page 1 preview image

Loading page ...

11CHAPTER 1INTRODUCTION: THE ROLE, HISTORY, ANDDIRECTION OF MANAGEMENT ACCOUNTINGQUESTIONS FOR WRITING AND DISCUSSION1.A management accounting information sys-tem is an information system that producesoutputs using inputs and processes neededto satisfy specific managerial objectives.2.Theinputsofamanagementaccountinginformationsystemareeconomicevents.The processes transform the inputs into out-puts and are such things as collecting, mea-suring,storing,analyzing,reporting,andmanaging. Typical outputs include specialreports, product costs, customer costs, per-formancereports,budgets,andpersonalcommunication.3.The three objectives of a management ac-counting information system are as follows:To provide information for costing out ser-vices, products, and other objects of interestto management; to provide information forplanning, controlling, evaluation, and conti-nuous improvement; and to provide informa-tion for decision making.4.Allorganizations—manufacturing,mer-chandising,andservices—musthaveagoodmanagementaccountinginformationsystem. Management accounting conceptsand procedures are not restricted to any onetype of organization.5.Theusersofmanagementaccountingin-formation are managers and workers withinthe organization. Anyone internal to an or-ganization is a potential user of manage-ment accounting information.6.Management accounting information is usedto cost out objects (for example, servicesand products) and to aid in planning, control-ling,evaluation,continuousimprovement,and decision making.7.Both financial and nonfinancial informationshould be provided by the management ac-countinginformationsystem.Nonfinancialinformation provides insights useful for con-trolling operations—it is easily used by op-erationalworkers.Financialinformationiscritical for evaluating the success of opera-tional control.8.Continuous improvement means searchingfor ways of increasing overall efficiency andproductivity of activities by reducing waste,increasing quality, and reducing costs.9.Employee empowerment is allowing opera-tional workers to plan, control, and makedecisions without explicit authorization frommiddle- and higher-level managers.10.Operational workers must be informed sothat they can evaluate and monitor the effec-tiveness of their decisions.11.Planningestablishesperformancestan-dards,feedbackcomparesactualperfor-mance with planned performance, and con-trolling uses feedback to evaluate deviationsfrom plans.12.Performance reports are formal reports thatcompare actual data with planned data orbenchmarksandthusprovidesignalstomanagers that allow them to take correctiveactions.13.Management accounting differs from finan-cial accounting in the following major ways:(1)internallyfocused,(2)nomandatedrules, (3) financial and nonfinancial; subjec-tive information possible, (4) emphasis onthe future, (5) internal evaluation and deci-sions based on very detailed information, (6)broad, multidisciplinary.14.The requirement to prepare reports for ex-ternal users created a demand for a particu-lar accounting information system. This sys-tem was geared to produce inventory costs.Aggregate average cost information appar-ently was sufficient for most internal deci-sions.Thus,managementaccountingbe-cameanextensionofthefinancialaccounting system. This outcome was prob-ably due to a favorable cost-benefit tradeoff.The incremental cost of producing

Preview Mode

This document has 653 pages. Sign in to access the full document!

Report

Study Now!

Document Details

Related Documents

Accounting

Master Managerial Accounting Techniques

Controlling and Reporting of Real Assets

Team A Week 5 Problems

Accounting Audit Final Exam MCQs 2015

Sarbanes Oxley Act, GAAP and IFRS

Understanding Internal Control and Audit Processes

Analysis of Relevant Costs in Managerial Decision-Making

Decision Making with Managerial Accounting

Government wide statements and Fund statements

Company

Explore

Study Tools