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Managerial Accounting: Tools for Business Decision Making, 2nd Edition

by: Jerry J. Weygandt (Univ. of Wisconsin, Madison); Donald E. Kieso (Emeritus, Northern Illinois Univ.); Paul D. Kimmel (Univ. of Wisconsin-Milwaukee)

Managerial Accounting: Tools for Business Decision Making, 2nd Edition

by: Jerry J. Weygandt (Univ. of Wisconsin, Madison); Donald E. Kieso (Emeritus, Northern Illinois Univ.); Paul D. Kimmel (Univ. of Wisconsin-Milwaukee)

ISBN 13:
9780471413653
ISBN 10:
0471413658
Edition: 2nd
Format: Hardcover
Copyright: 10/01/2001
Publisher: Wiley
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Summary

Presents important analytical tools to decision making. * Strong real world application. * Emphasis on critical thinking and managerial decision-making.

Praface

KEY FEATURES OF EACH CHAPTER

Managerial Accounting

Compares and contrasts managerial accounting with financial accounting

Identifies three broad functions of management

Defines three classes of manufacturing costs

Distinguishes between product costs and period costs

Presents costs of goods manufactured section of income statement

Presents overview of trends in managerial accounting including shift toward service industries, value chain management, enterprise resource planning, just-in-time inventory, and activity-based costing

Job Order Cost Accounting

Provides overview of cost accounting systems

Illustrates flow of costs in a job order cost system

Presents use of job cost sheet

Demonstrates use of predetermined overhead rate

Illustrates basic entries for job order cost system

Provides simple presentation of overapplied and underapplied overhead

Process Cost Accounting

Explains the difference between job order and process costing systems

Illustrates the flow of costs and end-of-period accounting procedures for process costing

Demonstrates computation of physical units of production, equivalent units of production, and unit costs

Shows how to assign costs to units of output and prepare a production cost report

Activity-Based Costing

Explains the need for activity-based costing (ABC)

Contrasts ABC to traditional costing systems

Identifies numerous activities, activity cost pools, and cost drivers

Discusses implications of value-added and non-value added activities

Illustrates use of ABC in service industries

Reviews the benefits and limitations of ABC

Illustrates use of just-in-time inventory systems

Appendix discusses the implications of activity hierarchies levels

Cost-Volume-Profit Relationships

Distinguishes between variable and fixed costs, and explains relevant range and mixed costs

Identifies components and assumptions of CVP analysis

Discusses concept of contribution margin

Illustrates calculation of break-even point

Discusses margin of safety and target net income

Illustrates CVP income statement

Appendix presents variable and absorption costing

Budgetary Planning

Discusses benefits of budgeting

Illustrates the process of assembling information for a master budget

Prepares budgeted income statement, balance sheet, and cash budget

Discusses use of budgets in merchandising, service, and not-for-profit enterprises

Budgetary Control and Responsibility Accounting

Explains how budgets are used to control costs and operations

Contrasts static budgets and flexible budgets

Uses a case study to illustrate usefulness of flexible budgets

Illustrates responsibility reporting systems

Defines cost centers, profit centers, and investment centers

Illustrates the computation and use of return on investment and (in a chapter appendix) residual income

Performance Evaluation Through Standard Costs

Differentiates between a standard and a budget

Discusses advantages of standard costs and methods of computing

Illustrates computation of direct materials variance, direct labor variance, and manufacturing overhead variance

Demonstrates analysis through comparison of actual with standard

Appendix illustrates the journal entries for a standard cost system

Incremental Analysis

Presents the concept of incremental analysis through a simple example

Explains the concepts of relevant cost, opportunity cost, and sunk cost

Applies incremental analysis in the following decision settings:

Accept an order at a special price

Make or buy

Sell or process further, including discussion of joint costs

Retain or replace equipment

Eliminate an unprofitable segment

Reviews sales mix issues, including how to allocate limited resources across multiple products and how to determine break-even points with more than one product

Capital Budgeting

Discusses nature of capital budgeting decisions

Describes and illustrates four methods of evaluating capital expenditures:

Cash payback technique

Net present value method

Internal rate of return method

Annual rate of return technique

Discusses the profitability index, post audits, and the implications of intangible benefits when making capital budgeting decisions

Pricing Decisions

Demonstrates how to compute target cost when a product's price is determined by the market

Illustrates how to compute target selling price using cost-plus pricing

Demonstrates how to use time and materials pricing when services are provided

Discusses the objective of transfer pricing

Illustrates how to determine a transfer price using the cost-based, market-based, and negotiated approaches

Explains the issues involved when goods are transferred between countries with different tax rates

The Statement of Cash Flows

Discusses the purpose and usefulness of the statement of cash flows

Discusses the implications of the product life-cycle for analysis of the statement of cash flows

Illustrates preparation of the statement of cash flows using a two-year progression of transactions. Year 1 is basic transactions, and year 2 involves more advanced transactions. The presentation is designed to allow the instructor to focus exclusively on either the indirect approach or the direct approach, or to cover both

Presents ratio analysis of the statement of cash flows using free cash flow, capital expenditure ratio, current cash debt coverage, cash debt coverage, and cash return on sales

Financial Analysis: The Big Picture

Provides a comprehensive discussion of analytical tools and their interrelationships

Discusses the concept of earning power and the presentation of irregular items: discontinued operations, extraordinary items, and cumulative effect of change in accounting principle

Includes a basic discussion of comprehensive income

Illustrates horizontal and vertical analysis

Provides thorough analysis of the actual financial statements of Kellogg Company using ratio analysis

NEW IN THIS EDITION

The First Edition of Managerial Accounting was very well received. In the spirit of continuous improvement, we have made many changes in this Second Edition. The changes can be categorized into three types: Cases for Management Decision Making, Interactive CD-ROM and Web site, and changes to the text chapters

Cases for Management Decision Making

Consistent with our objective of developing decision-making skills, we have added a series of cases to this edition of the text. These cases provide opportunities to use the decision tools presented in the chapters in a realistic business situation. The cases can be used as a comprehensive capstone activity at the end of the course, or as a recurring activity during the course. These activities are intended to be richer and more challenging than a traditional problem but are still targeted at the introductory-level student

Interactive CD-ROM and Web Site

Technology offers many opportunities to enrich the learning environment. With this edition of the text we have expanded the materials provided on our Web site, as well as developed an interactive CD-ROM. These materials include the following:

Learning Techniques resources are designed to improve student study skills

Learning Styles Quiz

Interactive Study Skills Chart

Course Materials reinforce materials covered in the text or provide resources to develop communication skills

Interactive Self-Test

Key Term Matching Activity

Accounting Cycle Tutorial

Interactive Problems and Demonstration Problems

Writing Handbook

Surviving the Group Project

Career Paths provides resources about careers in accounting

Why Accounting Is Important

Careers in Accounting

Professional Profiles

KEY CHANGES IN EACH CHAPTER

Managerial Accounting

New Feature Story on Compaq Computer

Revised and streamlined presentation on management functions

New Business Insight on auto manufacturing productivity

New Business Insight on managing the delivery of bananas

Revised coverage of service industry trends, significantly revised illustrations

New section on value chain management

Two new e-Business Insights on computerized business infrastructures and computer-integrated manufacturing

Revised exercises and problems

Job Order Cost Accounting

Clarified rationale for predetermined overhead rates

New e-Business Insight on GM's Web-based order system

New Business Insight on the use of microcomputers by small manufacturers

New Business Insight on overhead in service companies

Revised exercises and problems

Process Cost Accounting

Added a six-page appendix discussing and illustrating the FIFO method of computing equivalent units (as contrasted to the weighted average method covered in the chapter)

Activity-Based Costing

Moved ``Activity-Based Costing in Service Industries'' section from appendix into body of the chapter

Moved section on hierarchy of activity levels from the body of the chapter into an appendix

Revised the infographic on activities and related cost drivers to tie it more conceptually to the illustrations, and expanded the text explanation of the related illustrations

New Business Insight on General Mills's efforts to eliminate nonvalue-added activities

Revised exercises and problems

Cost-Volume-Profit Relationships

Added new section on CVP income statement, including illustrations of the statement with and without net income

Revised the section on use of the mathematical equation in breakeven analysis

Simplified the presentation of detailed CVP income statement

Revised the Decision Toolkit to include the contribution margin ratio

New Business Insight on efficiency in woodworking

New e-Business Insight on flightserve.com

New e-Business Insight on Internet business ``conversion rates''

New Business Insight on the use of computer graphics in ``what if analysis''

Revised exercises and problems

Budgetary Planning

Simplified long-range planning discussion

New e-Business Insight on improving planning and budgeting

Revised exercises and problems

Budgetary Control and Responsibility Accounting

Added new chapter appendix on ``Residual Income-Another Performance Measurement'' and related home-work material

New e-Business insight on enterprise application systems (EAS)

Revised exercises and problems

Performance Evaluation Through Standard Costs

Added a new Before You Go On (Review It/Do It) following direct materials variances section

Moved the Standard Cost Accounting System section with journal entries into a chapter appendix

New e-Business Insight on computerized standard cost systems

Revised exercises and problems

Incremental Analysis

Added joint-product presentation with illustrations in sell-or-process-further section, plus related homework materials

Revised exercises and problems

Capital Budgeting

Added several new marginal Helpful Hints

New e-Business Insight on General Electric's e-business related capital expenditures

Revised exercises and problems

Pricing Decisions

Entirely new chapter consisting of two major pricing-decision parts: I. External sales (customer pricing), and II. Internal sales (transfer pricing)

A chapter appendix discusses the absorption cost and the contribution approaches

All new homework material

A Comprehensive Problem covering Chapters 1-11 is provided on the CD-Rom that accompanies the text, as well as on the book's Web site

The Statement of Cash Flows (formerly Chapter 11)

New Feature Story-``Cash is Cash, and Everything Else is Accounting''

New section on the corporate life cycle

New section on the meaning of the term ``cash flows''

New Business Insight on the corporate life cycle of specific companies

New infographic drawings

New Business Insight comparing ``net income'' to ``net cash from operations''

Revised exercises and problems

Financial Analysis: The Big Picture (formerly Chapter 12)

New Feature Story on the day-trading New York cabby

Updated Kellogg Company and Quaker Oats financial results used in analysis

Expanded the explanation of comparative analysis

New e-Business Insight on internal security analysis

Revised exercises and problems

Appendix A: New Specimen Financial Statements: Tootsie Roll Industries, Inc

Appendix B: New Comparative Specimen Financial Statements: Hershey Foods Corporation

Appendix C: Time Value of Money

Appendix D: Ethical Standards

Cases for Management Decision Making

New selection of five cases to be used in conjunction with Chapters 2, 4, 5, 6, 9, 10, and 11

PROVEN PEDAGOGICAL FRAMEWORK

In this book we have used many proven pedagogical tools to help students learn accounting concepts and apply them to decision making in the business world. This pedagogical framework emphasizes the processes students undergo as they learn

Amazon no longer offers textbook rentals. We do!

Managerial Accounting: Tools for Business Decision Making, 2nd Edition

Managerial Accounting: Tools for Business Decision Making, 2nd Edition

9780471413653

0471413658

Summary

Table of Contents

Supplemental Materials

Write a Review

Amazon no longer offers textbook rentals. We do!

Managerial Accounting: Tools for Business Decision Making, 2nd Edition

Managerial Accounting: Tools for Business Decision Making, 2nd Edition

9780471413653

0471413658

Summary

Table of Contents

Supplemental Materials

Write a Review

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