BA225 Managerial Accounting Assignment

BA225 Managerial Accounting Assignment

W5 Assignment “Application Problems 5”

Page 298: Brief Exercises 7-1, 7-2

BE7-1 The steps in management’s decision-making process are listed in random below. Indicate the in which the steps should be executed.

________ Make a decision ________ Review results of the decision

________ Identify the problem and assign ________ Determine and evaluate possible responsibility courses of action

BA225 Managerial Accounting Assignment

BE7-2 Bogart Company is considering two alternatives. Alternative A will have revenues of $160,000 and costs of $100,000. Alternative B will have revenues of $180,000 and costs of $125,000. Compare Alternative A to Alternative B showing incremental revenues, costs, and net income.

Pages 300-301: Exercises 7-1, 7-4

E7-1 As a study aid, your classmate Pascal Adams has prepared the following list of statements about decision-making and incremental analysis.

1. The first step in management’s decision-making process is, “Determine and evaluate possible courses of action.”

2. The final step in management’s decision-making process is to actually make the decision.

3. Accounting’s contribution to management’s decision-making process occurs primarily in evaluating possible courses of action and in reviewing the results.

4. In making business decisions, management ordinarily considers only financial information because it is objectively determined.

5. Decisions involve a choice among alternative courses of action.

6. The process used to identify the financial data that change under alternative courses of action is called incremental analysis.

7. Costs that are the same under all alternative courses of action sometimes affect the decision.

8. When using incremental analysis, some costs will always change under alternative courses of action, but revenues will not.

9. Variable costs will change under alternative courses of action, but fixed costs will not.

BA225 Managerial Accounting Assignment

Instructions: Identify each statement as true or false. If false, indicate how to correct the statement.

Page 303: Exercise 7-9

E7-9 Anna Garden recently opened her own basketweaving studio. She sells finished baskets in addition to the raw materials needed by customers to weave baskets of their own. Anna has put together a variety of raw material kits, each including materials at various stages of completion. Unfortunately, owing to space limitations, Anna is unable to carry all varieties of kits originally assembled and must choose between two basic packages. The basic introductory kit includes undyed, uncut reeds (with dye included) for weaving one basket. This basic package costs Anna $16 and sells for $30. The second kit, called Stage 2, includes cut reeds that have already been dyed. With this kit the customer need only soak the reeds and weave the basket. Anna is able to produce the second kit by using the basic materials included in the first kit and adding one hour of her own time, which she values at $18 per hour. Because she is more efficient at cutting and dying reeds than her average customer, Anna is able to make two kits of the dyed reeds, in one hour, from one kit of undyed reeds. The Stage 2 kit sells for $36.

Instructions: Determine whether Anna’s basketweaving studio should carry the basic introductory kit with undyed and uncut reeds or the Stage 2 kit with reeds already dyed and cut. Prepare an incremental analysis to support your answer.

W5

As

signment “Application Problems 5

”

Page 298: Brief Exercises 7

–

1, 7

–

2

BE7

–

1

The steps in management’s decision

–

making proc

ess are listed in random

below. Indicate

the in which the steps should be executed.

________ Make a decision

________ Review results of the decision

________ Identify t

he problem and assign

________ D

etermine and evaluate possible

responsibility

courses of action

BE7

–

2

Bogart Company is considering two alternatives. Al

ternati

ve A will have revenues

of $160,000 and

costs of $100,000. Alternative B will have

revenues of $180,000 and costs

of $125,000. Compare

Alternative A to Alternative B showing i

ncremental revenues, costs, and net income.

Pages 300

–

301: Exercises 7

–

1, 7

–

4

E7

–

1

As a study aid, your classmate

Pascal Adams has prepared the following list of statements about

decision

–

making and incremental analysis.

1. The first step in management’s decision

–

making proce

ss is, “Determine and evaluate

possible courses

of action.”

2. The final step in management’s decision

BA225 Managerial Accounting Assignment

making process is to actually make the decision.

3. Accounting’s contribution to management’s decision

–

m

aking process occurs primarily

in evaluating

possible courses of action and in reviewing the results.

4. In

making business decisions, management ordinarily considers only financial information because it

is objectively determined.

5. Decisions involve a choice among alternative courses of action.

6. The process used to identify the financial data that change un

der alternative courses of

action is

called incremental analysis.

7. Costs that are the same under all alternative courses

of action sometimes affect the

decision.

8. When using incremental analysis, some costs will a

lways change under alternative

cours

es of action,

but revenues will not.

9. Variable costs will change under alternative courses of action, but fixed costs will not.

Instructions

:

Identify each statement as true or false. If false, indicate how to correct the statement.

Page 303: Exercise 7

–

9

E7

–

9

Anna Garden recently opened her own basketweaving studio. She sells finished baskets in addition

t

o the raw materials needed by customers

to weave

baskets of their own.

Anna has put together a

variety of raw material kits, each

including materials at various

stages of completion. Unfortunately,

W5 Assignment “Application Problems 5”

Page 298: Brief Exercises 7-1, 7-2

BE7-1 The steps in management’s decision-making process are listed in random below. Indicate

the in which the steps should be executed.

________ Make a decision ________ Review results of the decision

________ Identify the problem and assign ________ Determine and evaluate possible responsibility

courses of action

BE7-2 Bogart Company is considering two alternatives. Alternative A will have revenues of $160,000 and

costs of $100,000. Alternative B will have revenues of $180,000 and costs of $125,000. Compare

Alternative A to Alternative B showing incremental revenues, costs, and net income.

Pages 300-301: Exercises 7-1, 7-4

E7-1 As a study aid, your classmate Pascal Adams has prepared the following list of statements about

decision-making and incremental analysis.

1. The first step in management’s decision-making process is, “Determine and evaluate possible courses

of action.”

2. The final step in management’s decision-making process is to actually make the decision.

3. Accounting’s contribution to management’s decision-making process occurs primarily in evaluating

possible courses of action and in reviewing the results.

4. In making business decisions, management ordinarily considers only financial information because it

is objectively determined.

5. Decisions involve a choice among alternative courses of action.

6. The process used to identify the financial data that change under alternative courses of action is

called incremental analysis.

7. Costs that are the same under all alternative courses of action sometimes affect the decision.

8. When using incremental analysis, some costs will always change under alternative courses of action,

but revenues will not.

9. Variable costs will change under alternative courses of action, but fixed costs will not.

Instructions: Identify each statement as true or false. If false, indicate how to correct the statement.

Page 303: Exercise 7-9

E7-9 Anna Garden recently opened her own basketweaving studio. She sells finished baskets in addition

to the raw materials needed by customers to weave baskets of their own. Anna has put together a

variety of raw material kits, each including materials at various stages of completion. Unfortunately,