Study guide to accompany Managerial accounting / Douglas W. Kieso...[et al].

1 Managerial Accounting 1-1Just Add Water . . . and Paddle: Current Designs 1-1Managerial Accounting Basics 1-3Comparing Managerial and Financial Accounting 1-3Management Functions 1-3Organizational Structure 1-4Managerial Cost Concepts 1-7Manufacturing Costs 1-7Product Versus Period Costs 1-8Illustration of Cost Concepts 1-9Manufacturing Costs in Financial Statements 1-10Income Statement 1-11Cost of Goods Manufactured 1-11Cost of Goods Manufactured Schedule 1-12Balance Sheet 1-13Managerial Accounting Today 1-14Service Industries 1-14Focus on the Value Chain 1-15Balanced Scorecard 1-17Business Ethics 1-17Corporate Social Responsibility 1-182 Job Order Costing 2-1Profiting from the Silver Screen: Disney 2-1Cost Accounting Systems 2-3Process Cost System 2-3Job Order Cost System 2-3Job Order Cost Flow 2-4Accumulating Manufacturing Costs 2-5Assigning Manufacturing Costs 2-7Raw Materials Costs 2-8Factory Labor Costs 2-10Predetermined Overhead Rates 2-12Entries for Jobs Completed and Sold 2-15Assigning Costs to Finished Goods 2-15Assigning Costs to Cost of Goods Sold 2-16Summary of Job Order Cost Flows 2-17Job Order Costing for Service Companies 2-18Advantages and Disadvantages of Job Order Costing 2-19Applied Manufacturing Overhead 2-20Under- or Overapplied Manufacturing Overhead 2-213 Process Costing 3-1The Little Guy Who Could: Jones Soda 3-1Overview of Process Cost Systems 3-3Uses of Process Cost Systems 3-3Process Costing for Service Companies 3-4Similarities and Differences Between Job Order Cost and Process Cost Systems 3-4Process Cost Flow and Assigning Costs 3-6Process Cost Flow 3-6Assigning Manufacturing Costs-Journal Entries 3-6Equivalent Units 3-9Weighted-Average Method 3-9Refinements on the Weighted-Average Method 3-10The Production Cost Report 3-12Compute the Physical Unit Flow (Step 1) 3-13Compute the Equivalent Units ofProduction (Step 2) 3-13Compute Unit Production Costs (Step 3) 3-14Prepare a Cost Reconciliation Schedule (Step 4) 3-15Preparing the Production Cost Report 3-15Costing Systems-Final Comments 3-16Appendix 3A: FIFO Method for Equivalent Units 3-19Equivalent Units Under FIFO 3-19 Comprehensive Example 3-20FIFO and Weighted-Average 3-244 Activity-Based Costing 4-1Precor Is on Your Side: Precor 4-1Traditional vs. Activity-Based Costing 4-3Traditional Costing Systems 4-3Illustration of a Traditional Costing System 4-3The Need for a New Approach 4-4Activity-Based Costing 4-4ABC and Manufacturers 4-7Identify and Classify Activities and Allocate Overhead to Cost Pools (Step 1) 4-7Identify Cost Drivers (Step 2) 4-8Compute Activity-Based Overhead Rates (Step 3) 4-8Assign Overhead Costs to Products (Step 4) 4-9Comparing Unit Costs 4-10ABC Benefits and Limitations 4-12The Advantage of Multiple Cost Pools 4-12The Advantage of Enhanced Cost Control 4-13The Advantage of Better Management Decisions 4-15Some Limitations and Knowing When to Use ABC 4-16ABC and Service Industries 4-17Traditional Costing Example 4-18Activity-Based Costing Example 4-18Appendix 4A: Just-in-Time Processing 4-22Objective of JIT Processing 4-23Elements of JIT Processing 4-23Benefits of JIT Processing 4-235 Cost-Volume-Profit 5-1Don't Worry-Just Get Big: Amazon.com 5-1Cost Behavior Analysis 5-2Variable Costs 5-3Fixed Costs 5-3Relevant Range 5-5Mixed Costs 5-6Mixed Costs Analysis 5-7High-Low Method 5-7Importance of Identifying Variable and Fixed Costs 5-9Cost-Volume-Profit Analysis 5-10Basic Components 5-10CVP Income Statement 5-11Break-Even Analysis 5-14Mathematical Equation 5-15Contribution Margin Technique 5-15Graphic Presentation 5-16Target Net Income and Margin of Safety 5-18Target Net Income 5-18Margin of Safety 5-20Appendix 5A: Regression Analysis 5-226 Cost-Volume-Profit Analysis:Additional Issues 6-1Not Even a Flood Could Stop It: Whole Foods Market 6-1Basic CVP Concepts 6-3Basic Concepts 6-3Basic Computations 6-3CVP and Changes in the BusinessEnvironment 6-5Sales Mix and Break-Even Sales 6-8Break-Even Sales in Units 6-8Break-Even Sales in Dollars 6-9Sales Mix with Limited Resources 6-12Operating Leverage and Profitability 6-14Effect on Contribution Margin Ratio 6-15Effect on Break-Even Point 6-15Effect on Margin of Safety Ratio 6-16Operating Leverage 6-16Appendix 6A: Absorption Costing vs. Variable Costing 6-19Example Comparing Absorption Costing with Variable Costing 6-19Net Income Effects 6-21Decision-Making Concerns 6-25Potential Advantages of Variable Costing 6-277 Incremental Analysis 7-1Keeping It Clean: Method Products 7-1Decision-Making and Incremental Analysis 7-3Incremental Analysis Approach 7-3How Incremental Analysis Works 7-4Qualitative Factors 7-5Relationship of Incremental Analysis and Activity-Based Costing 7-5Types of Incremental Analysis 7-6Special Orders 7-6Make or Buy 7-8Opportunity Cost 7-9Sell or Process Further 7-10Single-Product Case 7-11Multiple-Product Case 7-11Repair, Retain, or Replace Equipment 7-14Eliminate Unprofitable Segment or Product 7-158 Pricing 8-1They've Got Your Size-and Color: Zappos.com 8-1Target Costing 8-3Establishing a Target Cost 8-4Cost-Plus and Variable-Cost Pricing 8-5Cost-Plus Pricing 8-5Limitations of Cost-Plus Pricing 8-7Variable-Cost Pricing 8-8Time-and-Material Pricing 8-10Transfer Prices 8-13Negotiated Transfer Prices 8-14Cost-Based Transfer Prices 8-17Market-Based Transfer Prices 8-18Effect of Outsourcing on Transfer Pricing 8-18Transfers Between Divisions in Diff erent Countries 8-19Appendix 8A: Absorption-Cost and Variable-Cost Pricing 8-21Absorption-Cost Pricing 8-21Variable-Cost Pricing 8-23Appendix 8B: Transfers Between Divisions in Different Countries 8-249 Budgetary Planning 9-1What's in Your Cupcake?: BabyCakes NYC 9-1Effective Budgeting and the Master Budget 9-3Budgeting and Accounting 9-3The Benefits of Budgeting 9-3Essentials of Eff ective Budgeting 9-3The Master Budget 9-6Sales, Production, and Direct Materials Budgets 9-8Sales Budget 9-8Production Budget 9-9Direct Materials Budget 9-10Direct Labor, Manufacturing Overhead, and S&A Expense Budgets 9-13Direct Labor Budget 9-13Manufacturing Overhead Budget 9-14Selling and Administrative Expense Budget 9-15Budgeted Income Statement 9-15Cash Budget and Budgeted Balance Sheet 9-17Cash Budget 9-17Budgeted Balance Sheet 9-20Budgeting in Nonmanufacturing Companies 9-22Merchandisers 9-22Service Companies 9-23Not-for-Profit Organizations 9-2410 Budgetary Control and Responsibility Accounting 10-1Pumpkin Madeleines and a Movie: Tribeca Grand Hotel 10-1Budgetary Control and Static Budget Reports 10-3Budgetary Control 10-3Static Budget Reports 10-4Flexible Budget Reports 10-6Why Flexible Budgets? 10-7Developing the Flexible Budget 10-9Flexible Budget-A Case Study 10-9Flexible Budget Reports 10-11Responsibility Accounting and Responsibility Centers 10-13Controllable versus Noncontrollable Revenues and Costs 10-15Principles of Performance Evaluation 10-15Responsibility Reporting System 10-17Types of Responsibility Centers 10-18Investment Centers 10-22Return on Investment (ROI) 10-23Responsibility Report 10-23Judgmental Factors in ROI 10-24Improving ROI 10-24Appendix 10A: ROI vs. Residual Income 10-28Residual Income Compared to ROI 10-28Residual Income Weakness 10-2911 Standard Costs and Balanced Scorecard 11-180,000 Different Caffeinated Combinations: Starbucks 11-2Overview of Standard Costs 11-3Distinguishing Between Standards and Budgets 11-4Setting Standard Costs 11-4Direct Materials Variances 11-7Analyzing and Reporting Variances 11-7Calculating Direct Materials Variances 11-9Direct Labor and Manufacturing Overhead Variances 11-11Direct Labor Variances 11-11Manufacturing Overhead Variances 11-14Variance Reports and Balanced Scorecards 11-16Reporting Variances 11-16Income Statement Presentation of Variances 11-16Balanced Scorecard 11-17Appendix 11A: Standard Cost Accounting System 11-21Journal Entries 11-21Ledger Accounts 11-23Appendix 11B: Overhead Controllable and Volume Variances 11-24Overhead Controllable Variance 11-24Overhead Volume Variance 11-2512 Planning for Capital Investments 12-1Floating Hotels: Holland America Line 12-2Capital Budgeting and Cash Payback 12-3Cash Flow Information 12-3Illustrative Data 12-4Cash Payback 12-4Net Present Value Method 12-6Equal Annual Cash Flows 12-7Unequal Annual Cash Flows 12-8Choosing a Discount Rate 12-9Simplifying Assumptions 12-9Comprehensive Example 12-10Capital Budgeting Challenges and Refinements 12-11Intangible Benefits 12-11Profitability Index for Mutually Exclusive Projects 12-13Risk Analysis 12-14Post-Audit of Investment Projects 12-15Internal Rate of Return 12-16Comparing Discounted Cash Flow Methods 12-17Annual Rate of Return 12-1813 Statement of Cash Flows 13-1Got Cash?: Microsoft 13-1Usefulness and Format of the Statement of Cash Flows 13-3Usefulness of the Statement of Cash Flows 13-3Classification of Cash Flows 13-3Significant Noncash Activities 13-4Format of the Statement of Cash Flows 13-5Preparing the Statement of Cash Flows-Indirect Method 13-6Indirect and Direct Methods 13-7Indirect Method-Computer Services Company 13-7Step 1: Operating Activities 13-9Summary of Conversion to Net Cash Provided by Operating Activities-Indirect Method 13-12Step 2: Investing and Financing Activities 13-13Step 3: Net Change in Cash 13-14Analyzing the Statement of Cash Flows 13-17Free Cash Flow 13-17Appendix 13A: Statement of Cash Flows-Direct Method 13-19Step 1: Operating Activities 13-19Step 2: Investing and Financing Activities 13-25Step 3: Net Change in Cash 13-26Appendix 13B: Worksheet for the Indirect Method 13-26Preparing the Worksheet 13-27Appendix 13C: Statement of Cash Flows-T-Account Approach 13-3114 Financial Analysis: The Big Picture 14-1It Pays to Be Patient: Warren Buffett 14-1Sustainable Income and Quality of Earnings 14-3Sustainable Income 14-3Quality of Earnings 14-7Horizontal Analysis and Vertical Analysis 14-9Horizontal Analysis 14-10Vertical Analysis 14-12Ratio Analysis 14-14Liquidity Ratios 14-15Solvency Ratios 14-16Profitability Ratios 14-16Comprehensive Example of Ratio Analysis 14-17Appendix A Time Value of Money A-1Interest and Future Values A-1Nature of Interest A-1Future Value of a Single Amount A-3Future Value of an Annuity A-5Present Value A-7Present Value Variables A-7Present Value of a Single Amount A-7Present Value of an Annuity A-9Time Periods and Discounting A-11Present Value of a Long-Term Note or Bond A-11Capital Budgeting Situations A-14Using Financial Calculators A-15Present Value of a Single Sum A-16Present Value of an Annuity A-17Future Value of a Single Sum A-17Future Value of an Annuity A-17Internal Rate of Return A 18Useful Applications of the Financial Calculator A-18Cases for Managerial Decision-Making(The full text of these cases is available in WileyPLUS.)Company Index I-1Subject Index I-3

Many corporate managers struggle to see the relevance of accounting in their everyday responsibilities. Weygandt shows them how managerial accounting information fits in the larger context of business so they are better able to understand the important concepts.