Managerial Accounting Essay

explicate the distinguishing features of managerial report. key out the trinity broad functions of management. Define the three classes of manufacturing costs. Distinguish amidst harvest-feast and period costs. Explain the difference among a merchandising and a manufacturing income statement. Indicate how cost of advantageouslys make is determined. Explain the difference between a merchandising and a manufacturing balance sheet. Identify trends in managerial report.managerial story is a field of accounting that forgets economic and monetary information for managers and opposite inseparable users. (b) Mary is incorrect. Managerial accounting applies to all types of businessesservice, merchandising, and manufacturing. (a) Financial accounting is concerned principally with orthogonal users such as stockholders, creditors, and regulators. In contrast, managerial accounting is concerned primarily with internal users such as officers and managers. Financial statements be the end product of pecuniary accounting. The statements are prepared quarterly and annually.In managerial accounting, internal reports may be prepared as frequently as needed. The conclusion of financial accounting is to provide general- conception information for all users. The purpose of managerial accounting is to provide special-purpose information for specific decisions. 2. (b) (c) 3. Differences in the heart of the reports are as follows Financial Pertains to business as a unhurt and is highly aggregated. Limited to double-entry accounting and cost data. Generally accepted accounting principles. Managerial Pertains to subunits of the business and may be very detailed.Extends beyond double-entry accounting system to any relevant data. Standard is relevance to decisions. In financial accounting, financial statements are verified annually through an sovereign study by certified public accountants. There are no independent audits of internal reports issued by manageria l accountants. 4. Budgets are prepared by companies to provide future direction. Because the budget is also used as an evaluation tool, whatever managers try to game the budgeting mould by underestimating their divisions predicted deed so that it will be easier to meet their performance targets.On the other hand, if the budget is set at unattainable levels, managers whatsoevertimes take wrong actions to meet targets to receive higher compensation or in some cases to keep their jobs. Karen should know that the management of an organization performs three broad functions (1) provision requires management to look ahead and to establish objectives. (2) Directing involves coordinating the diverse activities and benignant resources of a company to produce a smooth-running operation. (3) Controlling is the process of keeping the companys activities on track. Disagree.Decision making is non a separate management function. Rather, decision making involves the exercise of good judgme nt in performing the three management functions explained in the coiffe to question five above. Employees with line positions are like a shot involved in the companys primary revenue generating operating activities. Examples would include demonstrate managers and supervisors, and the vice president of operations. In contrast, employees with staff positions are not directly involved in revenuegenerating operating activities, but rather serve in a support capacity to line employees.Examples include employees in finance, legal, and human resources. 5. 6. 7. 1-4 Copyright 2010 John Wiley & Sons, Inc. Weygandt, Managerial Accounting, 5/e, Solutions Manual (For instructor Use Only) Questions Chapter 1 (Continued) 8. CEOs and CFOs must now certify that financial statements divide a fair presentation of the companys operating results and its financial condition and that the company maintains an adequate system of internal controls. In addition, the slice of the board of directors and audit committees receives more scrutiny, and penalties for misconduct have increased.The differences between income statements are in the computation of the cost of goods sold as follows Manufacturing company merchandising company 10. Beginning immaculate goods take stock plus cost of goods manufactured minus ending finished goods blood line = cost of goods sold. Beginning mathematical product inventory plus cost of goods purchased minus ending merchandise inventory = cost of goods sold. 9. The difference in balance sheets pertains to the presentation of inventories in the original asset section. In a merchandising company, only merchandise inventory is shown.In a manufacturing company, three inventory accounts are shown finished goods, pretend in process, and raw materials. Manufacturing costs are classified as both direct materials, direct labor, or manufacturing overhead. No, Matt is not correct. The distinction between direct and indirect materials is based on two cri teria (1) physical connectedness and (2) the convenience of making the physical association. Materials which can not be tardily associated with the finished product are considered indirect materials. Product costs, or inventoriable costs, are costs that are a necessary and integral part of producing the finished product.