亨格瑞管理会计英文第15版练习答案05解读

1、CHAPTER 5COVERAGE OF LEARNING OBJECTIVESLEARNING OBJECTIVEFUNDAMENTAL ASSIGNMENT MATERIALCRITICAL THINKING EXERCISES AND EXERCISESPROBLEMSCASES, EXCEL, COLLAB. & INTERNET EXERCISESLO1: Discrimi nate betwee n releva nt and irreleva nt in formati on for making decisi ons.23,30,37,3849,50,51,54,576

2、6LO2: Apply the decisi on process to make bus in ess decisi ons.28,29,39LO3: Co nstruct absorpti on and contribution-marg in in come stateme nts and ide ntify their releva nee for decisi on mak ing.A1,B124,31,32,33,34,3548LO4: Decide to acceptA or reject a special order using the contribution marg i

3、n tech ni que.2B236,4055,56,6263,64LO5: Explai n why pric ing decisi ons depe nd on the characteristics of the market.A2,B225,4258LO6: Iden tify the factors that in flue nce pric ing decisi ons in -practice.26,4147,52,5365LO7: Compute a target sales price by various approaches, and compare the adva

4、ntage and disadva ntages of these approaches3s43,44LO8: Use target costi ng to decide whether toadd a new product.A4,B327,45,4659,60,61CHAPTER 5Releva nt In formati on for Decisi on Making with a Focus on Pric ing Decisi ons5-A1(40-50 min.)1.INDEPENDENCE COMPANYCon tributi on In come Stateme ntFor t

5、he Year Ended December 31, 2021(in thousa nds of dollars)Sales$2,200Less variable expe nsesDirect material$400Direct labor330Variable manu facturi ng overhead (Schedule 1)150Total variable manu facturi ng cost ofgoods sold$880Variable selling expenses80Variable administrative expenses 5Total variabl

6、e expe nses985Con tributi on margin$1,215Less fixed expe nses:Fixed manu facturi ng overhead (Schedule 2)$345Selli ng expe nses220Admi nistrative expe nses9Total fixed expe nses684Operat ing in come$531INDEPENDENCE COMPANYAbsorpti on In come Stateme ntFor the Year En ded December 31, 2021(in thousa

7、nds of dollars)SalesLess manu facturi ng cost of goods sold:Direct materialDirect laborManu facturi ng overhead (Schedules 1 and 2)Total manu facturi ng cost of goods soldGross marginLess:Selli ng expe nsesAdmi nistrative expe nsesOperat ing in come$400330495$300144$2,2001,225 $ 975444$531INDEPENDEN

8、CE COMPANYSchedules of Manu facturi ng OverheadFor the Year En ded December 31, 2021(in thousa nds of dollars)Schedule 1: Variable CostsSuppliesUtilities, variable porti onIn direct labor, variable porti on Schedule 2: Fixed CostsUtilities, fixed porti onIn direct labor, fixed porti on Depreciati on

9、Property taxesSupervisory salaries Total manu facturi ng overhead$ 204090$150一345-$495$200,000$ 110,400531,000$420,6002. Change in reve nueChange in total con tributi on margi n:Contribution margin ratio in part 1 is $1,215$2,200 -= .552Ratio times decrease in reve nue is .552 $200,000

10、xOperat ing in come before cha ngeNew operati ng in comeThis an alysis is readily done by using data from the con tributi on in come stateme nt. In con trast, the data in the absorpti on in come stateme nt must be an alyzed and split into variable and fixed categories before the effect on operati ng

11、 in come can be estimated.1.A contribution format, which is similar to Exhibit 5-6, clarifies the analysis.Without Special OrderEffect of Special OrderWithSpecialOrderUnits2,000,000150,0002,150,000Sales$ 11,000,000Total$660,000Per Un it1 $4.40$11,660,000Less variable expe nses:Manu facturi ng$3,500,

12、000$322,500c2$2.15 53$ 3,822,500Selling & administrative800,00035,250835,250Total variable expe nses$4,300,000$357,750$2.385$ 4,647,250Con tributi on margin$6,700,000$302,250$2.015$ 7,002,250Less fixed expe nses:Manu facturi ng$3,000,00000.00$ 3,000,000Selling & administrative2,200,00000.002

13、,200,000Total fixed expe nses$ 52W0000.00$ 5,200,000Operat ing in come$1,500,000$302,250$2.015$ 1 802 2501 $660,000 - 150,000 = $4.402 Regular unit cost = $3,500,000 2,000,000 十=$ 1.75Logo.40Variable manu facturi ng costs$2.153 Regular unit cost = $800,000 2,000,000 十=$.40Less sales commissi ons not

14、 paid (3% of $5.50)(.165)Regular unit cost, exclud ing sales commissi on$.2352.Operati ng in come from selli ng 7.5% more units would in crease by $302,250 十 $1,500,000 = 20.15%. Note also that the average selling price on regularbus in ess was $5.50. The full cost, i nclud ing selli ng and adm ini

15、strative expe nses, was $4.75. The $4.75, plus the 40 per logo, 0 less savings in commissions of .165 came 0 to $4.985. The preside nt appare ntly wan ted $4.985 + .08($4.985) =$4.985 + .3988 = $5.3838 per pen.Most stude nts will probably criticize the preside nt for being too stubbor n. The cost to

16、 the compa ny was the forgo ing of $302,250 of in come in order to protect the compa ny's image and gen eral market positi on. Whether $302,250 was a wise in vestme nt in the future is a judgme nt that man agers are paid for ren deri ng.The purpose of this problem is to un derscore the idea that

17、 any of a nu mber of gen eral formulas might be used that, properly employed, would achieve the same target selli ng prices. Desired sales = $7,500,000 + $1,500,000 = $9,000,000.The target markup perce ntage would be:1. 100% of direct materials and direct labor costs of $4,500,000.Computatio n is: (

18、$9,000,000 - $4,500,000) $4,500,000 =T00%2. 50% of the full cost of jobs of $6,000,000.Computati on is: ($9,000,000 - $6,000,000) $6,000,000 =-50%3. $9,000,000 -$3,500,000 + $1,000,000 + $700,000)$5,200,000 -= 73.08%4. ($9,000,000 - $7,500,000) $7,500,000-= 20%5. $9,000,000 -$3,500,000 + $1,000,000

19、+ $700,000 + $500,000) $5,700,000-=$3,300,000 $ 弋700,000 = 57.9%If the con tractor is un able to maintain these profit perce ntages con siste ntly, the desired operat ing in come of $1,500,000 cannot be obta in ed.1. Revenue ($360 70,000) xTotal cost over product life Estimated contribution to profi

20、t Desired (target) contribution to profit 40% X$25,200,000Deficie ncy in profitThe product should not be released to producti on.2. Previous total estimated costCost sav ings from suppliers .20 X70 $ X8,000,000Revised total estimated costRevised total contribution to profit: $25,200,000 - $14,880,00

21、0Desired (target) contribution to profit Excess contribution to profitThe product should be released to producti on.3. Previous revised total estimated cost from requireme nt 2.Process improveme nt sav in gs: .25 X30 $ X8,000,000Less cost of new tech no logyRevised total estimated costRevised total

22、contribution to profit: $25,200,000 - $14,500,000Desired (target) contribution to profit Excess contribution to profitThe product should be released to producti on.$25,200,00016,000,000 $ 9,200,00010,080,000$ 880,000$16,000,0001,120,000$14,880,000$10,320,00010,080,000 $240,000$14,880,000$600,000220,

23、000380,00014,500,000$10,700,00010,080,000 车 620,0001.KINGLAND MANUFACTURINGCon tributi on In come Stateme ntFor the Year Ended December 31,2021$13,000Sales(In thousa nds of dollars)Less variable expe nses:Direct material$4,000Direct labor2,000Variable in direct manu facturi ngcosts (Schedule 1)960To

24、tal variable manu facturi ng cost of goods sold$6,960Variable selling expenses:Sales commissi ons$500Shipp ing expe nses300000Variable clerical salaries400Total variable expe nses8,160Con tributi on margin$ 4,840Less fixed expe nses:Manu facturi ng (Schedule 2)$ 702Selli ng (advertis ing)400Admi nis

25、trative-executive salaries100Total fixed expe nses1,202Operat ing in come$ 3,638KINGLAND MANUFACTURINGAbsorpti on In come Stateme ntFor the Year En ded December 31,2021(In thousa nds of dollars)SalesLess manu facturi ng cost of goods sold:Direct materialDirect laborSales commissi ons$500Advertis ing

26、400Shipp ing expe nses0Admini strative expe nses:Executive salaries$100Clerical salaries400(Schedules 1 and 2)Gross profitSelli ng expe nses:Operat ing in come$13,000$4,0002,000-425,338$1,2000 0$ 3,630In direct manu facturi ng costsKINGLAND MANUFACTURINGSchedules 1 and 2In direct Manu facturi ng Cos

27、tsFor the Year En ded December 31,2021(In thousa nds of dollars)Schedule 1: Variable CostsCutt ing bits$ 60Abrasives for machi ning100In direct labor800$ 960Schedule 2: Fixed CostsFactory supervisors' salaries$ 100Factory methods research40Lon g-term rent, factory100Fire in sura nee on equipme n

28、t2Property taxes on equipme nt30Depreciati on on equipme nt400Factory superi ntenden t's salary30702Total in direct manu facturi ng costsJ$1,6fi22.Operati ng in come would decrease from $3,638,000 to $3,268,000:Decrease in reve nue$1,000,000Decrease in total con tributi on margin*:Ratio times re

29、venue is .37 $1,000,000 x$370,000Decrease in fixed expe nses0Operat ing in come before in crease3,638,000New operati ng in come$3,268,000*Con tributi on margin ratio in con tributi on in come stateme nt is $4,840十$13,000 = .37 (rou nded).The above an alysis is readily calculated by using data from t

30、he con tributi on in comestateme nt. I n con trast, the data in the absorpti on in come stateme nt must be an alyzed and divided into variable and fixed categories before the effect on operati ng in come can be estimated.1.DANUBE COMPANYIn come Stateme ntFor the Year Ended December 31,20X0TotalPer U

31、n itSales$40,000,000$20.00Less variable expe nses:Manu facturi ngSelling & administrative$18,000,0009,000,00027,000,00013.50Con tributi on margin$13,000,000$ 6.50Less fixed expe nses:Manu facturi ngSelling & administrative$4,000,0006,000,00010,000,0005.00Operat ing in come$3 000 000$ 1 502.

32、Additi onal details are either in the stateme nt of the problem or in the soluti onto requireme nt 1:TotalPer UnitFull manu facturi ng cost.$22,000,000_$ 11.00Variable cost:Manu facturi ng$18,000,000$ 9.00Selling and administrative9,000,00040Total variable cost$27,000,000$ 13.50Full cost = fully all

33、ocated cost*Full manu facturi ng cost$22,000,000$11.00Selli ng and admi nistrative expe nses15 000 000750Full cost$37,000,000$ 18 50Gross margin ($40,000,000 - $22,000,000)$18 000 000$ 9 00Con trib. margin ($40,000,000 - $27,000,000)$13,000,000$ 6.50* Students should be alerted to the loose use of t

34、hese words. Their meaning may not be exactly the same from compa ny to compa ny. Thus, "fully allocated cost" in some compa nies may be used to refer to manu facturi ng costs only.3. Ricardo ' an alysis is in correct. He was on the right track, but he did not dist in guish sufficie ntl

35、y betwee n variable and fixed costs. For example, whe n multiplying the additional quantity ordered by the $11 full manufacturing cost, he failed to recog nize that $2.00 of the $11 full manu facturi ng cost was a "unitized" fixed cost allocation. The first fallacy is in regarding the tota

36、l fixed cost as though it fluctuated like a variable cost. A unit fixed cost can be misleading if it is used as a basis for predicting how total costs will behave.A sec ond false assumpti on is that no selli ng and adm ini strative expe nses will be affected except commissi ons. Shipp ing expe nses

37、and advertis ing allowa nces will be affected also - uni ess arran geme nts with Costco on these items differ from the regular arra ngeme nts.The following summary, which is similar to Exhibit 5-6 in the textbook, is a correct an alysis. The middle colu mns are all that are really n ecessary.Without

38、 Special OrderEffect of Special OrderWith Special OrderUnits2,000,000100,0002,100,000Sales$ 40,000,000,TotalPer Unit$ 1,600,000 $ 16.00$41,600,000Less variable expe nses:Manu facturi ng$ 18,000,000$ 900,000 $9.00$18,900,000Selling and administrative9,000,000330 0003 30*9,330,000Total variable expe n

39、ses$ 27,000,000$ 1,230,000 $ 12.30$28,230,000Con tributi on margin$ 13,000,000$ 370,000 $3.70$13,370,000Less fixed expe nses:Manu facturi ng$4,000,0000 0.00$ 4,000,000Selling and administrative6,000,00020,000 0.20*6,020,000Total fixed expe nses$ 10,000,00020,000 0.20$10,020,000Operat ing in come$3 0

40、00 000$350 000 $3 50$3 350 000*Regular variable selli ng and adm ini strative expe nses,$9,000,000 2,000,000 - =$ 4.50Less: Average sales commissi on at 6% of $20 =(1.20)Regular variable sell. and adm in. expe nses, less commissi on$ 3.30*Fixed selli ng and adm ini strative expe nses, specialcommiss

41、io n, $20,000 100,000 十.20Some stude nts may wish to en ter the $20,000 as an extra variable cost, making the unit variable selling and administrative cost $3.50 and thus adding no fixed cost. The final result would be the same; in any eve nt, the cost is releva nt because it would not exist without

42、 the special order.Some in structors may wish to point out that a 5% in crease in volume would cause an 11.7% in crease in operati ng in come, which seems like a high investment by Danube to maintain a rigid pricing policy.4. Ricardo is in correct. Operat ing in come would have decli ned from $3,000

43、,000 to$2,850,000, a decli ne of $150,000. Ricardo' s faulty an alysis follows:Old fixed manu facturi ng cost per un it,$4,000,0002,000,000 =$2.00New fixed manu facturi ng cost per un it,$4,000,000 2,500,000 =_ 0"Sav in gs"$ .40Loss on variable manu facturi ng costs per un it,$8.70 - $

44、9.00(.30)Net sav ings per unit in manu facturi ng costs$ 10The an alytical pitfalls of un it-cost an alysis can be avoided by using the contribution approach and concentrating on the totals:WithoutSpecial OrderEffect ofSpecialOrderWithSpecialOrderSales$40,000,000a$ 4,350,000$44,350,000Variable manu

45、facturi ng costs$18,000,000b$ 4,500,000$22,500,000Other variable costs9,000,00009,000,000Total variable costs-$27,000,000$ 4,500,000$31,500,000Con tributi on margin$13,000,000c$(150,000)$12,850,000ab 500,000>$8.70 selli ng price of special order500,000$ 刈.00 variable manu facturi ng cost per unit

46、 of special orderc500,000$ X30 negative contribution margin per unit of special orderNo matter how fixed manu facturi ng costs are un itized, or spread over the un its produced, their total of $4,000,000 rema ins un cha nged by the special order.1. Cost-plus pricing is adding a specified markup to c

47、ost to cover comp onents of the value cha in not in eluded in the cost plus a desired profit. In this case the markup is 30% of producti on cost.Price charged for piston pin = 1.30 $50.00 = $><65.00. If the estimated sellingprice is only $46 and this price cannot be in flue need by Caterpillar

48、, a man ager would be un likely to favor releas ing this product for producti on.2. Target costi ng assumes the market price cannot be in flue need by compa nies except by cha nging the value of the product to con sumers. The price charged would then be the $46 estimated by market research.The highe

49、st acceptable manu factured cost or target cost, T, isthoseTarget PriceTarget CostTarget Gross MarginDollars$ 46.00T$30T46 =.30T1.30T = 46T = 46 T.30 = $35.383. The required cost reducti on over the products life isExisti ng manu facturi ng cost$50.00Target manu facturi ng cost 8Required cost reduct

50、ion$14.62Steps that Caterpillar man agers can take to meet the required cost reducti on in clude value engineering during the design phase, Kaizen costing during the production phase, and activity-based man ageme nt throughout theproduct ' s life.5-1 Precisi on is a measure of the accuracy of ce

51、rta in data. It is a qua ntifiable term. Releva nee is an in dicati on of the pert inence of certa in facts for the problem at hand. Ideally, data should be both precise and releva nt, but releva nce gen erally takes priority.5-2 Decisi ons may have both qua ntitative and qualitative aspects corresp

52、 onding to the n ature of the facts being con sidered before decid ing. Quan titative implicati ons of alter native choices can be expressed in mon etary or nu merical terms, such as variable costs, i nitial in vestme nt, etc. Other releva nt features may not be qua ntifiable, such as the quality of

53、 life in a choice betwee n locati ng in San Fran cisco or New York. The adva ntage of quantitative information is that it is more objective and often easier to compare alter natives tha n with qualitative judgme nts.5-3 The accountant's role in decision-making is primarily that of a technical ex

54、pert on releva nt in formati on an alysis, especially releva nt costs. The acco untant is usually an information provider, not the decision maker, although the accountant may be part of a man ageme nt team charged with making decisi ons.5-4 No. On ly future costs that are differe nt un der differe n

55、t alter natives are releva nt to a decisi on.5-5 Past data are un cha ngeable regardless of prese nt or future acti on and thus would not differ un der differe nt alter natives.5-6 Past costs may be bases for formulating predictions. However, past costs are not in puts to the decisi on model itself because past costs cannot be cha nged by the decisi on.5-7 The con tributi on approach has several adva ntages over the absorpti on approach, in clud ing a better an alysis of cost-vo