accounting for managerial decisions - 689 Words

Topic 5 Homework Questions – Solution 1. Resources that are used in operations for more than one year with no physical substance are called: a. current assets b. intangible assets c. non-current assets d. property, plant and equipment 2. Able Company purchased land and incurred the following costs: Purchase price $1 000 000 Excavation costs 100 000 Removing old building 25 000 Broker fees 20 000 Cost of a parking lot 50 000 What is the cost of the land? a. $1 100 000 b. $1 195 000 c. $1 145 000 d. $1 125 000 3. Which of the following costs related to the purchase of production equipment incurred by ABC Company during 2013 would be considered an expense (revenue†¦show more content†¦not be amortised, but should be reviewed annually for impairment b. be reported on the statement of retained earnings in the year in which acquired c. be amortised over a reasonable period of time, not to exceed 40 years d. be debited to an expense account entirely in the year in which acquired 6. Information for Everett Evacuators for 2013 and 2012 is presented below. Everett uses the straight-line depreciation method. 2013 2012 Non-current assets $250 000 $190 000 Accumulated depreciation 100 000 85 000 Depreciation expense 62 500 47 500 Total revenues 1 000 000 900 000 Total assets 625 000 475 000 Using the data for 2013, determine the average useful life of Everett s non-current assets rounded to one decimal place. a. 1.6 years b. 2.5 years c. 4.0 years d. 10.0 years 7. On 1 July 2013, XYZ sold a piece of equipment for $30 000 which it had used for several years. The equipment had cost $45 000 and its accumulated depreciation amounted to $20 000 at the time of the sale. What are the net effects on the accounting equation of selling the equipment? a. Assets and equity increase $30 000 b. Assets decrease and equity increases $5 000 c. Assets and equity increase $5 000 d. Assets and equity decrease $5 000 8. Wong purchased equipment at the beginning ofShow MoreRelatedDecision Making With Managerial Accounting1563 Words   |  7 PagesDecision Making with Managerial Accounting Accounting is the process charged with the identification, measurement and the communication of economic information in the aim of allowing the desired users in making the correct decisions and judgments. Accounting has two branches depending on the users. Managerial accounting isuseful to core users unlike financial accounting which is more essential to exterior users. Management accounting is, therefore, the identification, analysis, recordRead MoreDecision Making in Managerial Accounting Essay2639 Words   |  11 PagesManagerial accountants need to use accounting information in seeing to it that they are able to plan, evaluate the company performance, manage risks and control the business operations in a manner that is deemed beneficial to the business as a whole (Caplan, n. d). This can be achieved through: having high standards of ethics in all situations; employing the techniques of management reports, budgetary control, and analysis of fund flows and financial statements; making prudent capital investmentRead MoreDecision Making Techniques in Managerial Accounting876 Words   |  4 PagesManagerial accounting comprises all the financial information needed to help managers make educated decisions and do their job duties efficiently. A typical manager’s responsibilities with managerial accounting include interpreting finance reports and projections and using those to make financial decisions that will affect the company. Since managers have to make routine decisions and finalize reports periodically, it is vital that they are able to conduct healthy decision making processes andRead MoreTraining And Managerial Accounting For Decision Making801 Words   |  4 PagesIntroduction Many of the lessons learned in FIN 301 (Corporate Finance) and ACCTG 211 (Financial and Managerial Accounting for Decision Making) are evident in everyday life as well as within my internship at Farmers Insurance. This journal entry will focus on two areas where my internship corresponds to the concepts learned in these courses. The first area is the financial services Farmers offers its customers and the second is the financial situation of Farmers Insurance. Financial Services FarmersRead MoreEthical Decision Making on Various Managerial Accounting Issues6054 Words   |  25 PagesJAMAR Vol. 2  · Number 2  · 2004 Ethical Decision Making on Various Managerial Accounting Issues Arnold Schneider* Abstract This study examines five managerial accounting issues that have ethical implications. These issues are based on situations described in managerial accounting textbooks. To induce truthful responses, an approach called the randomized response technique is used. With this technique, estimates are obtained for responses to sensitive questions relating to the five issues. ResultsRead MoreManagerial Accounting1152 Words   |  5 PagesManagerial Accounting 12/3/15 Managerial Accounting Accounting is a crucial part in running a business. There are various forms of accounting that can be used, it is very important to know which technique is best to use for what companies. Once you figure out a particular technique to use, it is important to keep an open mind if there are any changes that need to take place in the business. By keeping an open mind helps the business adjust and be able to make the right decisions. Every businessRead MoreManagerial Accounting And The Certified Management1408 Words   |  6 PagesManagerial accounting is used by an organization to ensure informed decisions are made regarding current and future operations. Businessmen and women must have the ability to comprehend financial information provided to properly determine the correct course of action. In the global market of today, an organization’s inability to accurately determine the best course of action can lead to financial ruin for the company. Uninformed decisions by leadersh ip can derail a business’ prospects for successRead MoreRole Of Managerial And Managerial Accounting1029 Words   |  5 Pagesof managerial accounting has played a significant role in the success of businesses dating as far back as the 19th century. Service and production operations during the days of the industrial revolution were not nearly as sophisticated then as they are today. The current initial purpose of managerial accounting is comparable to its purpose throughout history. Managerial accounting has historically been useful in assisting managers with the information they need to make important decisions aboutRead MoreDifference between Financial and Managerial Accounting 637 Words   |  3 PagesThe primary difference between financial and managerial accounting is that financial accounting is used for external members of the company; they do not control or run the businesses’ operations. An example of external members would be customers and shareholders o f the business. On the other hand, managerial accounting is used for internal members in the company such as managers and officers. The internal members use managerial accounting to increase efficiency and effectiveness within their companyRead MoreManagerial Accounting vs Financial Accounting Essay761 Words   |  4 PagesManagerial and Financial Accounting ACCT/300: Principles of Accounting April 9, 2008 Managerial and Financial Accounting This paper will attempt to differentiate between managerial and financial accounting, the users of managerial and financial accounting and what type of business decisions would be made with the information. Managerial Accounting Managerial accounting provides accounting information to managers who are inside an organization and who directs and controls its operations