Question: What is the key difference between a

> Management accounting should not fit the straitjacket of financial accounting.” Explain and give an example.

> The Chorus Company manufactures and sells pens. Present sales output is 5,000,000 units per year at a selling price of $0.60 per unit. Fixed costs are $1,080,000 per year. Variable costs are $0.36 per unit. Required: (Consider each case separately.) 1.

> Mirabel Cosmetics manufactures and sells a face cream to small family-run stores in the greater Montreal area. It presents the monthly operating statement of comprehensive income shown here to François Laval, a potential investor in the busi

> Sunshine Tours is a travel agency specializing in cruises between Miami and Jamaica. It books passengers on Carib Cruises. Sunshine’s fixed costs are $22,000 per month. Carib charges passengers $1,000 per round trip ticket. Required: Calculate the numbe

> Huron University is committed to improving access to higher education. Each year it makes $4,500,000 available for scholarships for students based on financial needs and academic achievement. The scholarship covers the full annual tuition (based on a ful

> The National Symphony is preparing for its annual appreciation dinner for contributing members. Last year, 500 members attended the dinner. Tickets for the dinner were $20 per attendee. Last year’s statement of comprehensive income was as follows: Ticke

> The Rapid Meal has two restaurants that are open 24 hours a day. Fixed costs for the two restaurants together total $450,000 per year. Service varies from a cup of coffee to full meals. The average sales bill per customer is $8.00. The average cost of fo

> Buger Research (BR) is a marketing research firm that organizes focus groups for consumer-product companies. Each focus group has eight individuals who are paid $50 per session to provide comments on new products. These focus groups meet in hotels and ar

> Each of the following cost items pertains to one of the following companies: Toyota (a manufacturing-sector company), Sobeys (a merchandising-sector company), and Google (a service-sector company): 1. Spring water purchased by Sobeys for sale to its cust

> In June 2016, the government of Vartan invited bids for the construction of a cellular telephone network. ZenTel, an experienced communications company, was eager to enter the growing field of cellular telephone networks in countries with poor infrastruc

> The data below are for Marvin Department Store. The account balances (in thousands) are for 2016. Marketing, distribution, and customer-service costs …………….$ 37,000 Merchandise inventory, January 1, 2016 …………………………………27,000 Utilities17,000General and ad

> Define cost smoothing and describe the consequences it can have on costs.

> The following are account balances relating to 2016 (in thousands): Property tax on plant building ……………………………………………..$4,200 Marketing, distribution, and customer-service costs …………….44,400 Finished goods inventory, January 1, 2016 …………………………….37,400 Pl

> The following are account balances relating to 2016 (in thousands): Property tax on plant building………………………………………………..$ 3,800 Marketing, distribution, and customer-service costs ………………44,400 Finished goods inventory, January 1, 2016 ………………………………32,400 P

> Rhonda Heninger is a well-known software engineer. Her specialty is writing software code used in maintaining the security of credit card information. Heninger is approached by the Electronic Commerce Group (ECG). They offer to pay her $120,000 for the r

> What are the two major types of organizational elements that managers focus on in companies using job costing?

> CVP is both simple and simplistic. If you want realistic analysis to underpin your decisions, look beyond CVP.” Do you agree? Explain.

> Do service-sector companies have inventoriable costs? Explain.

> Name three factors that affect the classification of a cost as direct or indirect.

> Yumball Candies manufactures jaw-breaker candies in a fully automated process. The machine that produces candies was purchased recently and can make 5,000 per month. The machine costs $6,000 and is depreciated using straight-line depreciation over 10 yea

> Define cost object and give three examples.

> Distinguish between processes where the inputs are non-substitutable and where they are substitutable.

> Describe why direct materials rate variance and direct materials efficiency variance may be computed with reference to different points in time.

> Distinguish between a favourable variance and an unfavourable variance .

> What is the relationship between management by exception and variance analysis ?

> ABC systems apply only to manufacturing companies.” Do you agree? Explain.

> How can the use of sensitivity analysis increase the benefits of budgeting?

> A number of terms are listed below: source document ………………………………………………..actual cost tracing ……………………………………..cost allocation rate proration ……………………………………………..opportunity cost cost pool Required: Select the terms from the above list to complete

> A number of terms are listed below: prime costs…………………………………………….fixed cost inventoriable costs………………………………period costs indirect………………………………………..conversion costs variable cost……………………………………….relevant cost Required: Select the terms from the above list

> Brite Exteriors is a firm that provides house painting services. Robert Brite, the owner, is trying to find new ways to increase revenues. Mr. Brite performs the following actions, not in the order listed. Required: Classify each action below according

> Consolidated Minerals (CM) owns the rights to extract minerals from beach sands on Fraser Island. CM has costs in three areas: a.Payment to a mining subcontractor who charges $80 per tonne of beach sand mined and returned to the beach (after being proces

> Honel Foods makes frozen dinners that it sells through grocery stores. Typical products include turkey dinners, pot roast, fried chicken, and meatloaf. The managers at Honel have recently introduced a line of frozen chicken pies. They take the following

> Conner Company makes and sells brooms and mops. It takes the following actions, not necessarily in the order given below. Required: For each action (1–5 below), state whether it is a planning decision or a control decision. 1. Conner asks its marketing

> A Canadian biopharmaceutical company incurs the following costs: 1. Cost of redesigning blister packs to make drug containers more tamper-proof. 2. Cost of videos sent to doctors to promote sales of a new drug. 3. Cost of a toll-free telephone line used

> Burger King, a hamburger fast food restaurant, incurs the following costs: 1. Cost of oil for the deep fryer. 2. Wages of the counter help who give customers the food they order. 3. Cost of the costume for the King on the Burger King television commercia

> A number of terms are listed below: timely ………………………………..management accounting ethical …………………………………guidelines cost–benefit technical ………………………………………………………control value chain ………………………………………………….reliable corporate social responsibility……………………… strategy

> Describe briefly why modern technology such as Electronic Data Interchange (EDI) is helpful to managers.

> Describe three different debit entries in the Work-in-Process Control general ledger T-account.

> Knowledge of technical issues such as computer technology is necessary but not sufficient to becoming a successful accountant.” Do you agree? Why?

> A number of terms are listed below: contribution margin ………………………cost–volume–profit analysis capital intensive …………………………………………..operating leverage gross margin …………………………………………………………….sales mix contribution margin percentage ………………………breakeven point ma

> The revenue budget is the cornerstone for budgeting.” Why?

> Maximum Office Products (MOP) produces three different paper products at its Vernon lumber plant—Supreme, Deluxe, and Regular. Each product has its own dedicated production line at the plant. MOP currently uses the following three-part

> If actual results do not match the budget, what should managers do?

> Define master budget.

> When governments reduce their funding to hospitals and universities, often the executives respond with a demand for an equal percentage reduction in costs by all business functions. Is this the best strategic approach?

> Comment on the following statement made by a plant supervisor: “Meetings with my plant accountant are frustrating. All he wants to do is pin the blame for the many variances he reports.

> Explain how the direct materials mix and direct materials yield variances provide additional information about the direct materials efficiency variance.

> Describe three reasons for an unfavourable direct manufacturing labour efficiency variance.

> List three causes of a favourable materials rate variance.

> How does static-budget variance analysis mislead those assessing actual performance against pro forma performance indicators?

> Explain how the choice of the responsibility centre type (cost, revenue, profit, or investment) affects budgeting.

> Graham’s Glassworks makes glass flanges for scientific use. Materials cost $1 per flange, and the glass blowers are paid a wage rate of $20 per hour. A glass blower blows 10 flanges per hour. Fixed manufacturing costs for flanges are $20,000 per period.

> Describe how non-output-based cost drivers can be incorporated into budgeting.

> Explain “padding” and why managers might be motivated to employ this negative budget behaviour. What are some of senior management’s options to address this behaviour?

> Define rolling budget. Give an example.

> How might a company benefit by sharing its own internal budget information with other companies?

> Strategy, plans, and budgets are unrelated to one another.” Do you agree? Explain.

> The controller of a retailer has just had a $50,000 request to implement an ABC system quickly turned down. A senior vice-president involved in rejecting the request noted, “Given a choice, I will always prefer a $50,000 investment in improving things a

> Increasing the number of indirect cost pools is guaranteed to sizably increase the accuracy of product or service costs.” Do you agree? Why?

> Describe four ways that help indicate when ABC systems are likely to provide the most benefits.

> Department indirect cost rates are never activity cost rates.” Do you agree? Explain.

> What are the key reasons for product cost differences between traditional costing systems and ABC systems?

> A student association has hired a musical group for a graduation party. The cost will be a fixed amount of $4,800. Required: 1. Suppose 500 people attend the party. What will be the total cost of the musical group; the unit cost per person? 2. Suppose 4

> What is an activity-based approach to refining a cost assignment system?

> Describe three alternative ways to dispose of underallocated or overallocated indirect costs.

> Comment on the following statement: “In a normal costing system, the amounts in the Manufacturing Overhead Control account will always equal the amounts in the Manufacturing Overhead Allocated account.”

> How does actual costing differ from normal costing?

> What is the main concern about source documents used to prepare job-cost records?

> Describe the three major source documents used in job-costing systems.

> Jorge Michaels is the Winnipeg-based controller of SXSW Foods, a rapidly growing manufacturer and marketer of Mexican food products. Michaels is currently considering the purchase of a new cost management package for use by each of its six manufacturing

> Janet Segato is division controller and Tom Maloney is division manager of the Sports Shoe Company. Segato has line responsibility to Maloney, but she also has staff responsibility to the company controller. Maloney is under severe pressure to achieve bu

> Harvest Day Corporation is a publishing company that produces trade magazines. The company’s shareholders are awaiting the announcement of Harvest Day’s earnings for the fiscal year, which ends on December 31. Market analysts have predicted earnings to b

> Janet Taylor is the new division controller of the snack-foods division of Gourmet Foods. Gourmet Foods has reported a minimum 15% growth in annual earnings for each of the past five years. The snack-foods division has reported annual earnings growth of

> Ana Compo is getting ready to open a small restaurant. She is on a tight budget and must choose between the following long-distance phone plans: Plan A: Pay 10 cents per minute of long-distance calling. Plan B: Pay a fixed monthly fee of $16 for up to 30

> Stephen Bergstrom is the new corporate controller of a multinational company that has just overhauled its organizational structure. The company is now decentralized. Each division is under an operating vice-president who, within wide limits, has responsi

> Softmoc is a shoe retailing company. The majority of its sales are made at its own stores. These stores are often located in shopping malls or in the downtown shopping districts of cities. A small but increasing percentage of sales are made via its inter

> A series of independent situations in which a firm is about to make a strategic decision follow. a. Yello Phones is about to decide whether to launch production and sale of a cell phone with standard features. b. Soft Solutions is trying to decide wheth

> Julie Leung is the newly appointed president of Northern University. Northern University Hospital (NUH) is a major problem for her because it is running large deficits. While it is not-for-profit, the province will reduce funding if hospitals fail to mee

> Coast Finance helps prospective homeowners of substantial means to find low-cost financing and assists existing homeowners in refinancing their current loans at lower interest rates. Coast works only for customers with excellent borrowing capacity. Hence

> Electric Eels Company produces high-quality electric eels for Museums and Aquaria to sell in their gift shops. It accounts for the production of these eels with an ABC system. For 2015, Electric Eels expected to produce and sell 16,000 units, but actual

> You are a student preparing for a job interview with a large Canadian consumer products manufacturer. You are applying for a job in the finance department. This company is known for its rigorous case-based interview process. One of the students who succe

> Tropical Fruits Inc. processes tropical fruit into a fruit salad mix, which it sells to a food-service company. Tropical Fruits has in its budget the following standards for the direct materials inputs to produce a batch of 80 kilograms of tropical fruit

> MFD Manufacturing makes wooden furniture. One of their products is a wooden dresser. The exterior and some of the shelves are made of oak, a highquality wood, but the interior drawers are made of pine, a less expensive wood. The budgeted direct materials

> Memflash Inc. manufactures 4 gigabyte flash drives that are compatible with a popular portable storage device. Memflash sells flash drives directly to computer retail chains and to direct marketing organizations that resell flash drives under their house

> The Fremont, California, plant of NUMMI (New United Motor Manufacturing, Inc.), a joint venture of General Motors and Toyota, assembles two types of cars (Corollas and Geo Prisms). A separate assembly line is used for each type of car. Required: Classif

> Your new position as supervisor of product introduction, you have to decide on a pricing strategy for a talking doll specialty product with the following cost structure: Variable costs per unit ……â€&brv

> Styles Inc. manufactures a full line of well-known sunglasses frames and lenses. Styles uses a standard costing system to set attainable standards for direct materials, labour, and overhead costs. Styles reviews and revises standards annually, as necessa

> Aunt Molly’s Old Fashioned Cookies bakes cookies for a chain of retail stores. The company’s best-selling cookie is Chocolate Nut Supreme, which is marketed as a gourmet cookie and regularly sells for $9.60 per kilogra

> Shayna’s Smart Shawls Inc. is a small business that Shayna developed while in college. She began hand-knitting shawls for her dorm friends to wear while studying. As demand grew, she hired some workers and began to manage the operation. Shayna’s shawls r

> Morro Bay Surfboards is a California company that manufactures fibreglass surfboards. The standard cost of direct materials and direct manufacturing labour is $100 per board. This includes 20 kilograms of direct materials, at the budgeted price of $2 per

> On May 1, 2015, Terra Company began the manufacture of a new internet paging device known as Flare. The company installed a standard costing system to account for manufacturing costs. The standard costs for a unit of Flare are as follows: Direct materia

> Grant Electric Inc. manufactures lamps. It has set up the following standards per finished unit for direct materials and direct manufacturing labour: Direct materials: 10 kg at $4.50/kg ……………………………………….$45.00 Direct manufacturing labour: 0.5 hour at $30

> For its manufacturing facility in Montreal, Quebec, Metalmoulder has a long-term contract with Osaka Metals. Metalmoulder manufactures large-scale machining systems that are sold to other industrial companies. Each machining system has a s izable direct

> Stevie McQueen has run Lightning Car Detailing for the past 10 years. His static-budget and actual results for June 2015 are provided below. Stevie has one employee who has been with him for all 10 years that he has been in business. He has not been as l

> The city of Riverside hired its first city manager four years ago. She favoured a “management by objectives” philosophy and accordingly set up many profit responsibility centres, including a sanitation department, a utility department, and a repair shop.

> Slopes Inc. manufactures and sells snowboards. Slopes manufactures a single model, the Pipex. In the summer of 2015, Slopes’s accountant gathered the following data to prepare budgets for 2016. These units are standard in the lumber ind

> Home Entertainment Centre (HEC) operates a large store in Halifax. The store has both a DVD section and a music section (compact discs, MP3 players, etc.). HEC reports revenues for the DVD section separately from the music section. Required: Classify ea

> Duncan Company manufactures a variety of products in a variety of departments, and evaluates departments and departmental managers by comparing actual costs and outputs relative to their budgets. Departmental managers help create the budgets and usually

> Francois Chenier is the purchasing agent for Highlight Manufacturing Company. Marge Belvedere is head of the production planning and control department. Every six months, Belvedere gives Chenier a general purchasing program. Chenier gets specifications f

> Assume the following: Pet Transport (PT) does not make any sales on credit. PT sells only to the public, and accepts cash and credit cards. Of its sales, 90% are to customers using credit cards, for which PT gets the cash right away, less a 3% transactio