Cost Management Strategies For Business Decisions 1st International Edition Marc Wouters, Michael W. Maher, Frank H. Selto, Ronald W. Hilton - Solutions

Discover comprehensive solutions and step-by-step answers for "Cost Management Strategies For Business Decisions" by Marc Wouters, Michael W. Maher, Frank H. Selto, and Ronald W. Hilton. Access online answers key and solutions manual to tackle complex problems with ease. Enhance your understanding with our test bank and instructor manual, providing clear chapter solutions and solved problems. Our textbook solutions are available in a convenient solutions pdf format, offering a free download option for seamless learning. Whether you're looking for detailed questions and answers or an in-depth solution manual, our resources ensure you have all the tools needed for academic success.

You are the chair of the board of directors of a large regional charitable organization that has been recognized nationally for outstanding public service. It has just lost its CEO to a profit-
You are offered the general manager position at a large, mostly autonomous division of a very large company. The company is market driven and has 20 similar divisions in different industries. The
You are offered an executive position at a small high-technology company. The salary is considerably lower than your current salary, but after one year, you will be eligible for many share options.
Shauna Dormino is taking a job in a non-profit organization, Freedom from Hunger. Anisa Morenez is taking a job at IBM. The women are equally qualified, each will do the same type of work, and each
The manager of an organization is having trouble getting employees to perform adequate work for the organization's benefit. 'I pay them a good salary,' says the manager, 'and I give them big pay
'It is a bigger mistake to develop an unreliable balanced scorecard than never to build one at all.' Do you agree with this statement? Why or why not?
Some companies formally advertise that its employees are its most important assets. If that is true, why does the balance sheet of these companies not have a category of assets for employees?
Customers' perceptions of value can differ across cultures. Many people believe that US-based companies are ignorant or arrogant when it comes to appreciating other cultures. Do you think this is
Until recently the CEO of Xerox Corporation prominently stated in his letter to the company's annual reports that Xerox always strives to improve customer satisfaction. Xerox no longer makes this
Respond to the following statement: 'Most measures of performance, such as profits and product costs, are useless for management decision making because they measure what has happened, not what will
A business executive says, "The financial area of a balanced scorecard indicates how the organization adds value to shareholders. I am involved with two organizations; a small business that is a
The chief operating officer of a non-profit organization states, 'It's all very well for a company like Westside to implement a balanced scorecard. It has measures in all four areas of the scorecard
What is the disadvantage of adopting a bonus bank?
How can a bonus bank improve the pay-for-performance relationship?
What is an intrinsic reward? How is an intrinsic reward different than an extrinsic reward? Are both necessary?
What are the different incentive effects of salary, cash bonus, shares, and share options?
What are the advantages and disadvantages of making all rewards immediate and of deferring them?
What is the possible relation between a balanced scorecard and the use of financial and non- financial measures of performance?
What are the advantages and disadvantages of formula-based versus subjective performance evaluations?
Contrast absolute and relative performance evaluations.
Explain how an incentive system's design might create disincentives to desired behaviour.
What are the key elements of an incentive system?
Why is 'pay for performance' the foundation of incentive systems?
Explain how an increase in employee capabilities can flow through an organization and how the effects are reflected in a balanced scorecard.
Is financial performance important to all types of organizations, even non-profits? Explain.
What is the difference between a leading and a lagging indicator of performance?
Review and define each of the chapter's key terms.
Some observers have suggested that fairness is a criterion that a transfer price should meet. What do you think it means for a transfer price to be 'fair'?
In setting transfer prices for multinationals, tax considerations can be the tail that wags the dog. Explain.
'Basing transfer prices on full absorption costs can really screw up decision making in a company!' Explain this remark by a manufacturing vice president, and construct a simple numerical example to
Setting transfer prices by negotiation is detrimental to the company. Do you agree or disagree with this statement by the CEO of a midsize manufacturing company? Why?
When setting a transfer price for goods sold across international boundaries, what factors should management consider?
Refer to Cost Management in Practice 15.2. Why did the Internal Revenue Service dispute the US subsidiary's reported profits and losses?
Division A has no external markets. It produces monofilament used by division B, which cannot purchase this particular type of monofilament from any other source. What transfer pricing system would
What are some goals of a transfer pricing system in a decentralized organization?
How does the choice of a transfer price affect the operating profits of both segments involved in an intracompany transfer?
Explain the effect of import duties, or tariffs, on the transfer pricing policies of multinational companies.
What is the general transfer pricing rule?
Some have suggested that managers should negotiate transfer prices. What are the disadvantages of a negotiated transfer pricing system?
What is the basis for choosing between actual and standard costs for cost-based transfer pricing?
Why do companies often use prices other than market prices for interdivisional transfers?
What are the advantages and disadvantages of top management's direct intervention in a transfer-pricing dispute?
What are the limitations to market-based transfer prices?
Why are market-based transfer prices considered optimal under many circumstances?
Describe four methods by which transfer prices can be set.
Why do transfer prices exist even in highly centralized organizations?
Why does ROI or residual income typically rise across time in a division? What undesirable behavioural implications could this phenomenon have?
Bleak Prospects Inc. found that its market share was slipping. Bleak encouraged division managers to maximize ROI and make decisions consistent with that goal. Nonetheless, frequent customer
Distinguish between the following measures of invested capital and briefly explain when each should be used: (1) total assets, (2) total productive assets, and (3) total assets less current
What is the chief disadvantage of ROI as an investment-centre performance measure? How does the residual-income measure eliminate this disadvantage?
Management of division A is evaluated based on residual income measures. The division can either rent or buy a certain asset. Might the performance evaluation technique have an impact on the
Explain how the manager of the automobile division of an insurance company could improve her division's ROI.
Explain why distinguishing between investment centres and their managers is important in performance evaluation.
Central management of Adler Inc. evaluated divisional performance using residual income (RI) measures. The division managers were ranked according to the RI in each division. All division managers
'Performance reports based on controllability are impossible. Nobody really controls anything in an organization!' Do you agree or disagree? Explain your answer.
Under what circumstances is it appropriate to change Outback Outfitters' Sydney plant from a profit centre to an investment centre?
Describe an alternative to using ROI, residual income or EVA to measure investment centre performance.
Define the term economic value added (EVA). How does it differ from residual income?
Why do some companies use gross book value instead of net book value to measure a division's invested capital?
Create an example showing the calculation of residual income. What information is used in computing residual income that is not used in computing ROI?
Under what conditions does the use of ROI measures inhibit a division manager's goal- congruent decision making?
The production department manager has just received a responsibility report showing a substantial unfavourable variance for overtime premium. The manager objects to the inclusion of this variance
What are the advantages of using an ROI-type measure rather than a division's profit as a performance evaluation technique?
Define and give examples of the following terms: standard cost centre, discretionary cost centre, revenue centre, profit centre and investment centre.
Suppose you overheard this comment: "This whole problem of measuring performance for segment managers using accounting numbers is so much hogwash. We pay our managers a good salary and expect them to
Accounting is supposed to provide a neutral, relevant and objective measure of performance. Why would problems arise when applying accounting measures in the context of performance evaluation?
Could the type of budget items for which some responsibility centres are accountable differ? That is, might some responsibility centres be responsible only for costs, some only for revenues and some
Why is goal congruence, or at least behavioural congruence, important to an organization's success?
(Appendix 13B) How could a CPA firm use a sales mix variance to analyse its revenue?
(Appendix 13B) A company sells three products that must be purchased in a single package. Does computing a sales mix variance provide any benefit under these circumstances?
What is the conceptual problem of applying fixed manufacturing overhead as a product cost?
Does the fixed overhead volume variance represent a difference in the cash outflows for the company when compared to budgeted cash outflows?
Bodin Company's only variable overhead cost is electricity. Does an unfavourable variable overhead spending variance imply that the company paid more than the anticipated rate per kilowatt hour?
Budgets for government units are usually one year in advance of the budget period. Expenditures are limited to the budgeted amount. At the end of the period, performance is evaluated by comparing
Give one example of a plausible activity base to use in flexible budgeting for each of the following organizations: an insurance company, an express delivery service, a restaurant and a state
How does the concept of flexible budgeting reinforce the notion that employees should be held responsible only for what they can control or heavily influence?
Why are flexible overhead budgets based on an activity measure such as machine hours or direct labour hours?
'I don't understand why you accountants want to prepare a budget for a period that is already over. We know the actual results by then - all that flexible budgeting does is increase the controller's
Discuss several ways in which standard costing systems should be adapted in today's advanced manufacturing environment.
Why should management want to divide production cost variances into price and efficiency variances?
In a service environment with no inventories, is variance analysis useful? Why or why not?
Distinguish between perfection and practical standards. Which type of standard is likely to produce the best motivational effects?
(Appendix 13B) Into what two variances is a revenue sales volume variance decomposed? What is the purpose of computing these two variances?
Distinguish between the control purpose and the product-costing purpose of standard costing and flexible budgeting.
What is the fixed overhead budget variance?
What is the interpretation of the variable overhead efficiency variance?
What is the interpretation of the variable overhead spending variance?
(Appendix 13A) List four companies that probably use direct material mix and yield variances.
What is meant by the term kaizen costing?
Describe how standard costs are used for product costing.
What is the interpretation of the direct labour efficiency variance? Which manager generally is in the best position to influence the direct labour efficiency variance?
What is the interpretation of the direct labour rate variance? Which manager generally is in the best position to influence the direct labour rate variance?
Describe the factors that managers often consider when determining the significance of a variance.
What is the interpretation of the direct material quantity variance? Which manager usually is in the best position to influence the direct material quantity variance?
What is the interpretation of the direct material price variance? Which manager usually is in the best position to influence the direct material price variance?
Explain how standard material prices and quantities are set.
One of the principles espoused by management is that one should manage by exception. How can responsibility reporting systems and/or analysis of variances assist in that process?
The manager of an operating department just received a cost report and has made the following comment with respect to the costs allocated from one of the service departments: 'This charge to my
Prepare a short presentation to explain and comment on this argument: cost allocation can never provide an incentive to reduce service costs unless the amount allocated is tied to some controllable
Consider a company with two producing departments and one service department. The service department allocates its costs to the producing departments on the basis of the number of employees in each

Showing 1 - 100 of 3353

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Last

Cost Management Strategies For Business Decisions 1st International Edition Marc Wouters, Michael W. Maher, Frank H. Selto, Ronald W. Hilton - Solutions

Step by Step Answers