Mastery Problem: Introduction to Managerial AccountingAble Baker Charlie CompanyCharles Maxwell is starting a cheesecake bakery, Able Baker Charlie Company, to produce and sell different flavored cheesecakes to restaurants and the general public. He has just begun his study of accounting, and is a bit confused about themany types of reports he has read about and how they will help him run his business. He asks you to help him clarify what the differences between managerial accounting and financial accounting are. He's also wondering how to set up hisinventory, how to classify the costs of his business, and how to fill in some missing information.Managerial vs. FinancialSelect whether the following characteristics are most often associated with managerial accounting or financial accounting.Primarily used for internal decision makingGenerally Accepted Accounting Principles (GAAP) must be usedPrepared statements usually pertain to the company as a whole rather than individual departments or productsInformation provided will often be subjective, such as estimated future resultsOften prepared on an as-needed basis rather than at fixed intervals

1. Primarily used for internal decision making – This feature is associated more with managerial…

Answered: Mastery Able Baker Charlie Company…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter9: Responsibility Accounting And Decentralization

Section: Chapter Questions

Problem 1EB: Assume you have been hired by Cabelas Sporting Goods. As part of your new role in the accounting...

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Assume you have been hired by Cabelas Sporting Goods. As part of your new role in the accounting department, you have been tasked to set up a responsibility accounting structure for the company. As your first task, your supervisor has asked you to give an example of a cost center, profit center, and an investment center within the Cabelas organization. Your supervisor is a little unsure of the difference between a profit center and investment center and would like you to explain the difference.
CASE:Outsourcing Accounting FunctionsYou have been employed for two years in the accounting department of a mid-sized multinational consumer products company. Your performance has been outstanding, and it is clear that management feels you have great potential with the firm. However, you are quite surprised when your manager calls you into her office to tell you that you have been chosen to lead an effort to identify an outsourcing partner for the payroll, accounts payable, and accounts receivable functions. She assures you that there will be an excellent assignment for you after the outsourcing is successfullycompleted and all is functioning well in one to two years. Questions: 1.What benefits might your organization gain from outsourcing basic accounting functions? 2. .Identify at least three major organizational challenges associated with transitioning these functions to an outsourcing firm.
Mastery Problem: Introduction to Managerial Accounting Able Baker Charlie Company Charles Maxwell is starting a cheesecake bakery, Able Baker Charlie Company, to produce and sell different flavored cheesecakes to restaurants and the general public. He has just begun his study of accounting, and is a bit confused about the many types of reports he has read about and how they will help him run his business. He asks you to help him clarify what the differences between managerial accounting and financial accounting are. He's also wondering how to set up his inventory, how to classify the costs of his business, and how to fill in some missing information. Managerial vs. Financial Select whether the following characteristics are most often associated with managerial accounting or financial accounting. Primarily used for internal decision making Generally Accepted Accounting Principles (GAAP) must be used Prepared statements usually pertain to the company as a whole rather than individual…
Identifying ethical standards The Institute of Management Accountants’ Statement of Ethical Professional Practice requires managerial accountants to meet standards regarding competence, confidentiality, integrity, and credibility. Consider the following situations. Which standard(s) are violated in each situation? You tell your brother that your company will report earnings significantly above financial analysts’ estimates. You see others take home office supplies for personal use. As an intern, you do the same thing, assuming that this is a “perk.” At a company-paid conference on e-commerce, you skip the afternoon session and go sightseeing. You failed to read the detailed specifications of a new accounting software package that you asked your company to purchase. After it is installed, you are surprised that it is incompatible with some of your company’s older accounting software. You do not provide top management with the detailed job descriptions they requested because you fear…
The Managerial Process Each of the following scenarios requires the use of accounting information to carry out one or more managerial accounting objectives. a. Laboratory Manager: An HMO approached me recently and offered us its entire range of blood tests. It provided a price list revealing the amount it is willing to pay for each test. In many cases, the prices are below what we normally charge. I need to know the costs of the individual tests to assess the feasibility of accepting its offer and perhaps suggest price adjustments on some of the tests. b. Operating Manager: This report indicates that we have 30% more defects than originally targeted. An investigation into the cause has revealed the problem. We were using a lower-quality material than expected, and the waste has been higher than normal. By switching to the quality level originally specified, we can reduce the defects to the planned level. c. Divisional Manager: Our market share has increased because of higher-quality products. Current projections indicate that we should sell 25% more units than last year. I want a projection of the effect that this increase in sales will have on profits. I also want to know our expected cash receipts and cash expenditures on a month-by-month basis. I have a feeling that some short-term borrowing may be necessary. d. Plant Manager: Foreign competitors are producing goods with lower costs and delivering them more rapidly than we can to customers in our markets. We need to decrease the cycle time and increase the efficiency of our manufacturing process. There are two proposals that should help us accomplish these goals, both of which involve investing in computer-aided manufacturing. I need to know the future cash flows associated with each system and the effect each system has on unit costs and cycle time. e. Manager: At the last board meeting, we established an objective of earning a 25% return on sales. I need to know how many units of our product we need to sell to meet this objective. Once I have the estimated sales in units, we need to outline a promotional campaign that will take us where we want to be. However, in order to compute the targeted sales in units, I need to know the expected unit price and a lot of cost information. f. Manager: Perhaps the Harrison Medical Clinic should not offer a full range of medical services. Some services seem to be having a difficult time showing any kind of profit. I am particularly concerned about the mental health service. It has not shown a profit since the clinic opened. I want to know what costs can be avoided if I drop the service. I also want some assessment of the impact on the other services we offer. Some of our patients may choose this clinic because we offer a full range of services. Required: Select the managerial accounting objective(s) that are applicable for each scenario: planning, controlling (including performance evaluation), or decision making.
Identifying ethical standards The Institute of Management Accountants’ Statement of Ethical Professional Practice requires managerial accountants to meet standards regarding competence, confidentiality, integrity, and credibility. Consider the following situations. Which standard(s) are violated in each situation? a. You tell your brother that your company will report earnings significantly above financial analysts’ estimates. b. You see others take home office supplies for personal use. As an intern, you do the same thing, assuming that this is a “perk.” c. At a company-paid conference on e-commerce, you skip the afternoon session and go sightseeing. d. You failed to read the detailed specifications of a new accounting software package that you asked your company to purchase. After it is installed, you are surprised that it is incompatible with some of your company’s older accounting software. e. You do not provide top management with the detailed job descriptions they requested…
Review the scripture below. Does God's word here have relevance to the concepts being studied in Managerial Accounting, or do spiritual and business concepts just not mix? Please share your ideas and give examples. Feel free to cite other sources. Luke 14:28-30 in the Bible reads: “But don’t begin until you count the cost. For who would begin construction of a building without first calculating the cost to see if there is enough money to finish it? Otherwise, you might complete only the foundation before running out of money, and then everyone would laugh at you. They would say, ‘There’s the person who started that building and couldn’t afford to finish it!’" Explain the meaning of (a) differential revenue, (b) differential cost, and (c) differential income. A company is offered incremental business at a special price that exceeds the variable cost. What other issues must the company consider in deciding whether to accept the business? Although the cost-plus approach to product…
Many students who study managerial accounting will work for small ad medium-sized businesses,and some may own small and medium-sized businesses. To operate a small and medium-sizedbusiness, you need an understanding of managerial accounting, among other skills. a) How could understanding managerial accounting help you as a small and medium-sizedbusiness owner of one of the competing firms?b) Using the Management Accounting , discuss how these two competingsmall and medium-sized firms can apply management accounting knowledge to positionthemselves strategically in the market.
Please describe a managerial accounting concept or topic you learned in this course. Identify the concept/topic and explain how it pertains to managerial accounting and how the concept/topic is beneficial for business owners or how it helps contribute to success.
Please describe a managerial accounting concept or topic you learned in this course. Identify the concept/topic and explain how it pertains to managerial accounting and how the concept/topic is beneficial for business owners or how it helps contribute to success.
1.) Discuss the difference between managerial accounting and financial accounting and their impact to Information Technology industry. 2.) You are the CEO of your own IT Company. Based on the cost concepts that we have discussed, identify at least three (3) costs being used and provide possible solutions how to control these costs. 3.) Being in an IT Field, you know the importance of optimizing your processes to see growth through efficiency. How can financial statement analysis contribute? 4.) Accounting is the language of business. Using this context, discuss the importance of financial statement to businesses.
Suppose that a company called Futuristics, Inc hires you to work in Supply Cha Management. Your new manager sets up a meeting to discuss the Surfers, Inc. account. The meeting opens with the manager stating, "I just reviewed the financial report on Surfers, Inc. It really doesn't cost much to serve them, does i Which of the following would be an appropriate response to the manager's statement? Traditional accounting methods are perfect to help us make decisions about serving the Surfers, Inc. account Activity-based costing would be better to report the Surfers, Inc. results to the financial community Traditional cost accounting gives us a good measure for comparing by customer Activity-based costing could better show us how much it really costs to serve Surfers, Inc. Activity-based costing takes depreciation into account to enable us to know when to replace machinery

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