1. (a) Managerial accounting is a field of accounting that provides economic information for all interested parties. Do you agree? Explain why
2. (b) Joe Delong believes that managerial accounting serves only manufacturing firms. I s Joe correct? Explain
4. Linda Olsen is studying for the next accounting midterm examination. Summarize for Linda what she should know about managerial functions.
5. Decision- making is management's most important function. Do you agree? Why or why not?
8. Jerry Lang is unclear as to the difference between balance sheets of a merchandising company and a manufacturing company. Explain the difference to Jerry.
BE 1-2 Listed below are the three functions of the management of an organization.
1. Planning 2. Directing 3. Controlling
Identify in which of the following statements best describes each of the above functions.
(a) ................. requires management to look ahead and to establish objectives. A key objective of management is to add value to the business.
(b) .................... involves coordinating the diverse activities and human resources of a company to produce a smooth -running operation. This function relates to the implementation of planned objectives.
(c) ......................... Is the process of keeping the activities on track? Management determines whether goals are being met and what changes are necessary when there are deviations.
BE1-3 Determine whether each of the following cost should be classified as direct materials(DM), direct labor(DL), or manufacturing overhead(MO)
(a) ................... Frames and tires used in manufacturing bicycles.
(b) ................... Wages paid to production workers.
(c) ................... Insurance on factory equipment and machinery.
(d) ................... Depreciation on factory equipment.
BE 1-4 Indicate whether each of the following costs of an automobile manufacturer would be classified as direct materials, direct labor, or manufacturing overhead.
(a) ............... Windshield
(b) ............... Engine
(c) ............... Wages of assembly line workers
(d) ............... Depreciation of factory machinery
(e) ................ Factory machinery lubricants
(f) ............... Tires
(g) ................ Steering Wheel
(h) ................ Salary of painting supervisor
BE1-5 Identify whether cost should be classified as product cost or period cost.
(a) ................... Manufacturing overhead
(b) ................... Selling expenses
(c) ................... Administrative expenses
(d) ................... Advertising expenses
(e) ................... Direct labor
(f) .................... Direct materials