Exam 1: B: Basic Cost Management Concepts

Identify and discuss the factors that are affecting the way cost accounting is practised.

Discuss how the goal of profit maximization is affected by ethical considerations.What incentives are there for managers to manipulate accounting data in unethical ways in order to increase profits?

Discuss the advances of information technology and how these advances might affect the university education supply chain.

You are a management accountant for the Eugene Division of Lowden Company.Your long-time friend,David Orth,is the Eugene Division manager.David was instrumental in helping you obtain your current position.Because the manager's annual bonus is based on the amount of profit the Eugene Division reports for the year,David has asked you to "massage the numbers" to make the Eugene Division appear more profitable. Considering the Standards of Ethical Conduct for Management Accountants,how would you respond to David Orth's request?

Give some examples of reporting feedback that will assist in continuous improvement of a dry cleaning company.

In choosing a cost management system,the controller must balance the total costs of implementing such systems.What costs must be balanced to determine total cost? How do functional-based and activity-based cost systems balance the trade-offs?

What can a company do to increase the likelihood of its employees being ethical in all their undertakings?

Why has time become such an important factor in competition?

You are a management accountant for Burn's Corporation.Ruth Hamilton,the sales representative for one of Burn's suppliers,invited you to attend a professional sporting event.Because you are an avid sports fan,you accepted Ruth's invitation. At the sporting event,Ruth begins talking about Burn's upcoming contract renewals with suppliers.Because there is intense competition and because it is the first bid she will submit to Burn's Corporation,she asks you to review her bid to make sure "it is good enough" before she submits it to the company.In addition,because you are knowledgeable about costs,especially regarding this contract,she asks you to tell her if her bid is "in the ballpark" or "needs improvement." She indicates that if she wins the contract,you will be provided with season tickets for the rest of the year. Considering the Standards of Ethical Conduct for Management Accountants,how would you respond to Ruth's request?

Discuss four factors that are changing the way we manufacture.

Describe several of the major differences between a functional-based cost management system and an activity-based cost management system.

Home Designs Company designs decks,gazebos,and play equipment for residential homes.The following was provided for the year ended June 30: Direct labour \6 00,000 Direct material purchases 40,000 Administrative 130,000 Overhead. 75,000 Selling 265,000 Beginning direct materials inventory 20,000 Beginning designs in process 14,000 Ending direct materials inventory 10,000 Ending designs in process 39,000 The average design fee is $700.There were 2,000 designs processed during the year. a.Prepare a statement of cost of services sold. b.Prepare an income statement. c.Discuss three differences between services and tangible products.