1 Managerial Accounting in the Information Age 1-1

Goal of Managerial Accounting 1-2

Cost Terms Used in Discussing Planning, Control, and Decision Making 1-7

Two Key Ideas in Managerial Accounting 1-10

The Information Age and Managerial Accounting 1-13

Ethical Considerations in Managerial Decision Making 1-17

The Controller as the Top Management Accountant 1-20

Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 1-22

End-of-Chapter Homework: Questions / Exercises / Problems / Cases 1-25

Appendix: IMA Statement of Ethical Professional Practice 1-32

2 Job-Order Costing for Manufacturing and Service Companies 2-1

Cost Classifications for Manufacturing Firms 2-2

Product Cost Information in Financial Reporting and Decision Making 2-6

Balance Sheet Presentation of Product Costs 2-7

Flow of Product Costs in Accounts 2-8

Income Statement Presentation of Product Costs 2-8

Types of Costing Systems 2-11

Overview of Job Costs and Financial Statement Accounts 2-11

Job-Order Costing System 2-13

Eastlake Revisited: Using Job Cost Information 2-18

Relation Between the Costs of Jobs and the Flow of Costs in Work in Process, Finished Goods, and Cost of Goods Sold 2-19

Allocating Overhead to Jobs: A Closer Look 2-20

Predetermined Overhead Rates 2-21

Job-Order Costing for Service Companies 2-24

Modern Manufacturing Practices and Product Costing Systems 2-27

Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 2-30

End-of-Chapter Homework: Questions / Exercises / Problems / Cases 2-35

3 Process Costing 3-1

Difference between Job-Order and Process Costing Systems 3-2

Product and Cost Flows 3-3

Calculating Unit Cost 3-6

Calculating and Applying Cost per Equivalent Unit: Mixing Department Example 3-7

Production Cost Report 3-9

Basic Steps in Process Costing: A Summary 3-11

Kent Chemical Revisited: Answering Stacy’s Question 3-12

Dealing with Transferred-in Cost: Packaging Department Example 3-12

Process Costing and Incremental Analysis 3-14

“You Get What You Measure!” and Manufacturing Processes 3-15

Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 3-16

End-of-Chapter Homework: Questions / Exercises / Problems / Cases 3-20

4 Cost-Volume-Profit Analysis 4-1

Common Cost Behavior Patterns 4-2

Cost Estimation Methods 4-6

Cost-Volume-Profit Analysis 4-14

Multiproduct Analysis 4-19

Assumptions in CVP Analysis 4-23

Codeconnect Example Revisited: Answering Mary’s Questions 4-23

Operating Leverage 4-24

Constraints 4-25

Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 4-26

End-of-chapter Homework: Questions / Exercises / Problems / Cases 4-30

Appendix: Using Regression in Microsoft Excel to Estimate Fixed and Variable Costs 4-46

5 Variable Costing 5-1

Full (Absorption) and Variable Costing 5-2

Effects of Production on Income for Full Versus Variable Costing: The Clausentube Example 5-5

Benefits of Variable Costing for Internal Reporting 5-12

Variable Costing Limits Management of Earnings via Production Volume 5-12

Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 5-13

End-of-Chapter Homework: Questions / Exercises / Problems / Cases 5-17

6 Cost Allocation and Activity-Based Costing 6-1

Purposes of Cost Allocation 6-2

Process of Cost Allocation 6-5

Allocating Service Department Costs 6-8

Problems with Cost Allocation 6-10

Activity-Based Costing 6-14

Activity-Based Management 6-23

Remember—You Get What You Measure! 6-24

Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 6-25

End-of-Chapter Homework: Questions / Exercises / Problems / Cases 6-29

Appendix: Activity-Based Management 6-46

7 The Use of Cost Information in Management Decision Making 7-1

Incremental Analysis 7-2

Analysis of Decisions Faced by Managers 7-5

Decisions Involving Joint Costs 7-14

Qualitative Considerations in Decision Analysis 7-17

Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 7-18

End-of-Chapter Homework: Questions / Exercises / Problems / Cases 7-21

Appendix: The Theory of Constraints 7-34

8 Pricing Decisions, Customer Profitability Analysis, and Activity-Based Pricing 8-1

The Profit-Maximizing Price 8-2

Pricing Special Orders 8-4

Cost-Plus Pricing 8-5

Target Costing 8-7

Analyzing Customer Profitability: Revisiting the Priced Right Office Supplies Case 8-8

Customer Profitability and Performance Measures 8-11

Activity-Based Pricing 8-11

Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 8-12

End-of-Chapter Homework: Questions / Exercises / Problems / Cases 8-19

9 Capital Budgeting and Other Long-Run Decisions 9-1

Capital Budgeting Decisions 9-2

Evaluating Investment Opportunities: Time Value of Money Approaches 9-3

Considering “Soft” Benefits in Investment Decisions 9-11

Estimating the Required Rate of Return 9-13

Additional Cash Flow Considerations 9-14

Other Long-Run Decisions 9-17

Simplified Approaches to Capital Budgeting 9-18

Conflict between Performance Evaluation and Capital Budgeting 9-21

Wilson Air Example Revisited 9-23

Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 9-24

End-of-Chapter Homework: Questions / Exercises / Problems / Cases 9-27

Appendix A: Using Microsoft Excel to Calculate NPV and IRR 9-36

Appendix B 9-39

10 Budgetary Planning and Control 10-1

Use of Budgets in Planning and Control 10-2

Developing the Budget 10-4

The Master Budget 10-5

Use of Computers in the Budget Planning Process 10-14

Budgetary Control 10-14

Investigating Budget Variances 10-17

Conflict in Planning and Control Uses of Budgets 10-18

Evaluation, Measurement, and Management Behavior 10-19

The Preston Joystick Case Revisited 10-20

Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 10-20

End-of-Chapter Homework: Questions / Exercises / Problems / Cases 10-26

11 Standard Costs and Variance Analysis 11-1

Standard Costs 11-2

A General Approach to Variance Analysis 11-5

Material Variances 11-5

Direct Labor Variances 11-7

Overhead Variances 11-8

Test Your Knowledge: Comprehensive Example 11-13

Investigation of Standard Cost Variances 11-16

Responsibility Accounting and Variances 11-19

Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 11-19

End-of-Chapter Homework: Questions / Exercises / Problems / Cases 11-23

Appendix: Recording Standard Costs in Accounts 11-33

12 Decentralization and Performance Evaluation 12-1

Why Firms Decentralize 12-2

Why Companies Evaluate the Performance of Subunits and Subunit Managers 12-4

Cost Centers, Profit Centers, and Investment Centers 12-6

Evaluating Investment Centers with ROI 12-8

Evaluation Using Economic Value Added (EVA) 12-13

Using a Balanced Scorecard to Evaluate Performance 12-18

Developing a Strategy Map for a Balanced Scorecard 12-21

Keys to a Successful Balanced Scorecard: Targets, Initiatives, Responsibility, Funding, Top Management Support 12-22

Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 12-23

End-of-chapter Homework: Questions / Exercises / Problems / Cases 12-28

Appendix: Transfer Pricing 12-39

Glossary G-1

Index I-1

Chapters 13 & 14 Available in WileyPLUS

13 Statement of Cash Flows 13-1

Need for a Statement of Cash Flows 13-2

Types of Business Activities and the Classification of Cash Flows 13-2

The Statement of Cash Flows Prepared Using the Direct Method 13-5

Preparing the Statement of Cash Flows Using the Indirect Method 13-9

Interpreting Information in the Statement of Cash Flows: The Situation at Ravira Restaurant Supply 13-13

Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 13-14

End-of-Chapter Homework: Questions / Exercises / Problems / Case 13-18

14 Analyzing Financial Statements: A Managerial Perspective 14-1

Why Managers Analyze Financial Statements 14-2

Horizontal and Vertical Analyses 14-4

Earnings Management and the Need to Compare Earnings and Cash-Flow Information 14-7

Other Sources of Information on Financial Performance 14-9

Ratio Analysis 14-10

A Managerial Perspective on the Analysis of HGW’S Financial Statements 14-14

Summary of Analyses 14-16

Chapter Review: Summary of Learning Objectives / Review Problems / Key Terms / Self-Assessment 14-17

End-of-chapter Homework: Questions / Exercises / Problems / Cases 14-21

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