加里森第十四版管理会计课后题答案CH08.docx

1、加里森第十四版管理会计课后题答案CH08Chapter 8Profit PlanningSolutions to Questions8-1 A budget is a detailed quantitative plan for the acquisition and use of financial and other resources over a given time period. Budgetary control involves using budgets to increase the likelihood that all parts of an organization

2、are working together to achieve the goals set down in the planning stage.8-2 1. Budgets communicate managements plans throughout the organization. 2. Budgets force managers to think about and plan for the future. In the absence of the necessity to prepare a budget, many managers would spend all of t

3、heir time dealing with day-to-day emergencies. 3. The budgeting process provides a means of allocating resources to those parts of the organization where they can be used most effectively. 4. The budgeting process can uncover potential bottlenecks before they occur. 5. Budgets coordinate the activit

4、ies of the entire organization by integrating the plans of its various parts. Budgeting helps to ensure that everyone in the organization is pulling in the same direction. 6. Budgets define goals and objectives that can serve as benchmarks for evaluating subsequent performance.8-3 Responsibility acc

5、ounting is a system in which a manager is held responsible for those items of revenues and costsand only those itemsthat the manager can control to a significant extent. Each line item in the budget is made the responsibility of a manager who is then held responsible for differences between budgeted

6、 and actual results.8-4 A master budget represents a summary of all of managements plans and goals for the future, and outlines the way in which these plans are to be accomplished. The master budget is composed of a number of smaller, specific budgets encompassing sales, production, raw materials, d

7、irect labor, manufacturing overhead, selling and administrative expenses, and inventories. The master budget usually also contains a budgeted income statement, budgeted balance sheet, and cash budget.8-5 The level of sales impacts virtually every other aspect of the firms activities. It determines t

8、he production budget, cash collections, cash disbursements, and selling and administrative budget that in turn determine the cash budget and budgeted income statement and balance sheet.8-6 No. Planning and control are different, although related, concepts. Planning involves developing goals and deve

9、loping budgets to achieve those goals. Control, by contrast, involves the means by which management attempts to ensure that the goals set down at the planning stage are attained.8-7 The flow of budgeting information moves in two directionsupward and downward. The initial flow should be from the bott

10、om of the organization upward. Each person having responsibility over revenues or costs should prepare the budget data against which his or her subsequent performance will be measured. As the budget data are communicated upward, higher-level managers should review the budgets for consistency with th

11、e overall goals of the organization and the plans of other units in the organization. Any issues should be resolved in discussions between the individuals who prepared the budgets and their managers. All levels of an organization should participate in the budgeting processnot just top management or

12、the accounting department. Generally, the lower levels will be more familiar with detailed, day-to-day operating data, and for this reason will have primary responsibility for developing the specifics in the budget. Top levels of management should have a better perspective concerning the companys st

13、rategy.8-8 A self-imposed budget is one in which persons with responsibility over cost control prepare their own budgets. This is in contrast to a budget that is imposed from above. The major advantages of a self-imposed budget are: (1) Individuals at all levels of the organization are recognized as

14、 members of the team whose views and judgments are valued. (2) Budget estimates prepared by front-line managers are often more accurate and reliable than estimates prepared by top managers who have less intimate knowledge of markets and day-to-day operations. (3) Motivation is generally higher when

15、individuals participate in setting their own goals than when the goals are imposed from above. Self-imposed budgets create commitment. (4) A manager who is not able to meet a budget that has been imposed from above can always say that the budget was unrealistic and impossible to meet. With a self-im

16、posed budget, this excuse is not available. Self-imposed budgets do carry with them the risk of budgetary slack. The budgets prepared by lower-level managers should be carefully reviewed to prevent too much slack.8-9 The direct labor budget and other budgets can be used to forecast workforce staffin

17、g needs. Careful planning can help a company avoid erratic hiring and laying off of employees.8-10 The principal purpose of the cash budget is NOT to see how much cash the company will have in the bank at the end of the year. Although this is one of the purposes of the cash budget, the principal pur

18、pose is to provide information on probable cash needs during the budget period, so that bank loans and other sources of financing can be anticipated and arranged well in advance.Exercise 8-1 (20 minutes) 1.JulyAugustSeptemberTotalMay sales:$430,000 10% $43,000$43,000June sales:$540,000 70%, 10% 378,

19、000$54,000432,000July sales:$600,000 20%, 70%, 10% 120,000420,000$60,000600,000August sales:$900,000 20%, 70% 180,000630,000810,000September sales:$500,000 20% 100,000100,000Total cash collections $541,000$654,000$790,000$1,985,000 Notice that even though sales peak in August, cash collections peak

20、in September. This occurs because the bulk of the companys customers pay in the month following sale. The lag in collections that this creates is even more pronounced in some companies. Indeed, it is not unusual for a company to have the least cash available in the months when sales are greatest. 2.

21、 Accounts receivable at September 30:From August sales: $900,000 10% $90,000From September sales: $500,000 (70% + 10%) 400,000Total accounts receivable $490,000Exercise 8-2 (10 minutes)JulyAugustSept.QuarterBudgeted sales in units 30,00045,00060,000135,000Add desired ending inventory* 4,5006,0005,00

22、05,000Total needs 34,50051,00065,000140,000Less beginning inventory 3,0004,5006,0003,000Required production 31,50046,50059,000137,000 *10% of the following months salesExercise 8-3 (15 minutes)QuarterYear 2Year 3FirstSecondThirdFourthFirstRequired production of calculators 60,00090,000150,000100,000

23、80,000Number of chips per calculator 33333Total production needschips 180,000270,000450,000300,000240,000Year 2FirstSecondThirdFourthYearProduction needschips 180,000270,000450,000300,0001,200,000Add desired ending inventorychips 54,00090,00060,00048,00048,000Total needschips 234,000360,000510,00034

24、8,0001,248,000Less beginning inventorychips 36,00054,00090,00060,00036,000Required purchaseschips 198,000306,000420,000288,0001,212,000Cost of purchases at $2 per chip $396,000$612,000$840,000$576,000$2,424,000Exercise 8-4 (20 minutes) 1. Assuming that the direct labor workforce is adjusted each qua

25、rter, the direct labor budget would be:1st Quarter2nd Quarter3rd Quarter4th QuarterYearUnits to be produced 5,0004,4004,5004,90018,800Direct labor time per unit (hours) 0.400.400.400.400.40Total direct labor hours needed 2,0001,7601,8001,9607,520Direct labor cost per hour $11.00$11.00$11.00$11.00$11

26、.00Total direct labor cost $22,000$19,360$19,800$21,560$82,720 2. Assuming that the direct labor workforce is not adjusted each quarter and that overtime wages are paid, the direct labor budget would be:1st Quarter2nd Quarter3rd Quarter4th QuarterYearUnits to be produced 5,0004,4004,5004,90018,800Di

27、rect labor time per unit (hours) 0.400.400.400.400.40Total direct labor hours needed 2,0001,7601,8001,9607,520Regular hours paid 1,8001,8001,8001,8007,200Overtime hours paid 20000160360Wages for regular hours ( $11.00 per hour) $19,800$19,800$19,800$19,800$79,200Overtime wages ( $11.00 per hour 1.5

28、hours) 3,300002,6405,940Total direct labor cost $23,100$19,800$19,800$22,440$85,140Exercise 8-5 (15 minutes) 1.Krispin CorporationManufacturing Overhead Budget1st Quarter2nd Quarter3rd Quarter4th QuarterYearBudgeted direct labor-hours 5,0004,8005,2005,40020,400Variable overhead rate $1.75$1.75$1.75$

29、1.75$1.75Variable manufacturing overhead $8,750$8,400$9,100$9,450$35,700Fixed manufacturing overhead 35,00035,00035,00035,000140,000Total manufacturing overhead 43,75043,40044,10044,450175,700Less depreciation 15,00015,00015,00015,00060,000Cash disbursements for manufacturing overhead $28,750$28,400$29,100$29,450$115,700 2.Total budgeted manufacturing overhead for the year (a) $175,700Total budgeted direc