管理会计答案第一章

CHAPTER 1 INTRODUCTION: THE ROLE, HISTORY, AND DIREC-TION OF MANAGEMENT ACCOUNTING

QUESTIONS FOR WRITING AND DISCUSSION

1. A management accounting information system is an information system that produces outputs using

inputs and processes needed to satisfy specific managerial objectives.

2.The inputs of a management accounting information system are economic events. The processes

transform the inputs into outputs and are such things as collecting, measuring, storing, analyzing, re-porting, and managing. Typical outputs include special reports, product costs, customer costs, perfor-mance reports, budgets, and personal communication.

3.The three objectives of a management accounting information system are listed as follows: To provide

information for costing out services, products, and other objects of interest to management; to provide information for planning, controlling, evaluation, and continuous improvement; and to provide informa-tion for decision making.

4.All organizations—manufacturing, merchan-dising, and services—must have a good management

accounting information system. Management accounting concepts and procedures are not restricted to any one type of organization.

5.The users of management accounting information are managers and workers within the organization.

Anyone internal to an organization is a potential user of management accounting information.

6.Management accounting information is used to cost out objects (for example, services and products)

and to aid in planning, controlling, evaluation, continuous improvement, and decision making.

7.Both financial and nonfinancial information should be provided by the management accounting infor-

mation system. Nonfinancial information provides insights useful for controlling operations—it is easily used by operational workers. Financial information is critical for evaluating the success of operational control.

8.Continuous improvement means searching for ways of increasing overall efficiency and productivity of

activities by reducing waste, increasing quality, and reducing costs.

9.Employee empowerment is allowing operational workers to plan, control, and make decisions without

explicit authorization from middle- and higher-level managers.

10.Operational workers must be informed so that they can evaluate and monitor the effectiveness of their

decisions.

11.Planning establishes performance standards, feedback compares actual performance with planned

performance, and controlling uses feedback to evaluate deviations from plans.

12.Performance reports are formal reports that compare actual data with planned data or benchmarks

and thus provide signals to managers that allow them to take corrective actions.

13.Management accounting differs from financial accounting in the following major ways: (1) internally

focused, (2) no mandated rules, (3) financial and nonfinancial; subjective information possible, (4) emphasis on the future, (5) internal evaluation and decisions based on very detailed information, (6) broad, multidisciplinary.

14.The requirement to prepare reports for external users created a demand for a particular accounting

information system. This system was geared to produce inventory costs. Aggregate average cost in-formation apparently was sufficient for most internal decisions. Thus, management accounting be-came an extension of the financial accounting system. This outcome was probably due to a favorable cost-benefit tradeoff. The incremental cost of producing more accurate product costs was not offset by the incremental benefits of improved decision making. However, significant changes in the compet-itive environment have increased the cost of making bad decisions, thus increasing the benefits of more accurate information. Also, information technology has decreased the cost of processing data.

These two events have led to a demand for an improved management accounting information system.

15.Activity-based management is an important approach that focuses management’s attention on activ i-

ties with the objective of improving the value received by the customer and the profit achieved by pro-viding this value. It is important because it is the heart of the contemporary management accounting system, offering increased accuracy in product costing (through the use of activity costing) and the ability to evaluate and control activities (through process value analysis).

16.Customer value is the difference between customer realization (what a customer receives) and cus-

tomer sacrifice (what a customer gives up). Focusing on customer value forces managers to consider the entire set of value-chain activities, including what happens after a product is sold. This creates a demand for a broader set of information than that found in a traditional system.

17.The internal value chain is the set of activities required to design, develop, produce, market, distribute,

and service a product (the product can be a service). To increase customer value, managers must assess the effect each activity in the chain has on customer value, keeping those that add value and eliminating those that do not.

18.Industrial value chain is the linked set of value-creating activities from raw materials through the end-

use customer. Understanding the industrial value chain is important because it enables a manager to identify the important internal and external linkages and use these linkages to create a competitive advantage.

19.Supply chain management is concerned with managing material flows starting with suppliers and

upstream suppliers, moving to production, and finishing with the distribution of finished goods to cus-tomers and downstream customers. Supply chain management focuses on the entire industrial value chain because potential benefits may be reaped by understanding upstream suppliers and down-stream customers.

20.E-business is any business transaction or information exchange that is executed using information

and communication technology. Management accountants provide information for e-business set-tings, e.g., the cost of processing an electronic transaction versus the cost of a paper transaction. 21.Managing the value chain requires a cross-functional perspective. Because of the interrelationships

that exist in the value chain, a decision can affect many different functions. Information must be ga-thered and reported so that these effects can be assessed and decision making improved.

22.Decreasing the time required to perform activities may increase quality and decrease costs. The

management accounting system should be able to document the relationship between time reductions and such things as quality and cost both on a projected or before-the-fact basis and on an after-the-fact basis. This enhances planning, controlling, and decision making.

23. A line position has direct responsibility for carrying out the basic missions of an organization. A staff

position has indirect responsibility for the basic missions and provides a supportive role for line activi-ties.

24.Yes. For most organizations, the controller should be a member of the top management staff. The

controller is the financial expert of an organization and can provide critical advice and insights.

25.The controller is responsible for both internal and external accounting. These responsibilities usually

include diverse activities such as taxes, SEC reports, cost accounting, bud-geting, internal auditing, fi-nancial accounting, and systems accounting.

26.Ethical behavior is concerned with making right choices and usually involves sacrificing individual self-

interest for the well-being of others. It is possible to teach ethical behavior in virtually any course. By being introduced to ethical dilemmas in management accounting, students can be made aware of the behavior that is expected in the business world and, in particular, for management accountants.

27.Yes. There is some evidence that ethical behavior actually is good business. In other words, the mar-

ket and consumers appreciate ethical behavior and are willing to reward those who adopt it.

28.Yes. As management accountants become more informed about what behavior is acceptable and

what is not, we should expect a favorable response. This response can be reinforced by the IMA im-posing sanctions for serious violations of the code.

29.The three forms of certification are the CMA, the CPA, and the CIA. Although each certification can be

valuable for management accountants, the CMA is tailored to fit their needs. The CPA has a public-accounting orientation, and the CIA has an internal-auditing orientation. Only the CMA specifically ad-dresses the professional requirements of a management accountant.

30.The four parts are (1) economics, finance, and management; (2) financial accounting and reporting;

(3) management reporting, analysis, and behavioral issues; and (4) decision analysis and information

systems. The parts reveal the interdisciplinary nature of management accounting.

EXERCISES

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1. Inputs: a, d, f, j

2. Processes: b, g, m

3. Outputs: c,h, i, l

4. System objectives: e, k, n

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1. e

2. b

3. c

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Joan Dennison is staff. She is in a support role—she prepares reports and helps ex-plain and interpret them. Her role is to help the line managers more effectively carry out their responsibilities.

Steven Swasey is a line manager. He has direct responsibility for producing a garden hose. Clearly, one of the basic objectives for the existence of a manufacturing firm is to make a product. Thus, Steven has direct responsibility for a basic objective and there-fore holds a line position.

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a. By the time most students graduate from high school, they have not had much ex-

posure to business. Therefore, they do not have full knowledge of acceptable be-havior for the business environment. Students may not know that certain practices are unethical because they may not be familiar with the behavioral norms asso-ciated with these practices. Once students begin to learn business practices, they begin to see what ethical dilemmas can arise in a business context. They then are able to apply the moral training they have had to deal with the situations. Further-more, evidence exists that ethical reasoning can be changed for the better. Thus, instruction in ethics can be a vital part of a student’s education.

b. Sacrificing self-interest is a choice that each person must make. Others may be in-

fluenced by those individuals who behave ethically. Individuals committed to ethical behavior produce societies committed to ethical behavior (not vice versa).

c. While this sounds noble, many would disagree that managers are first seeking to

serve others and accept personal financial rewards as a by-product of a good job.

Pursuit of self-interest and personal financial well-being is not necessarily unethical.

It is only when this pursuit is done at the expense of the collective good that the be-havior becomes questionable.

d. It is often true that unethical firms and individuals suffer financially. In the long run,

there is some evidence that ethical behavior pays off. It is doubtful, however, that every unethical firm or individual is wiped out financially. There are too many nota-ble exceptions (for example, the selling of drugs by organized crime).

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a. CPA

b. CIA

c. CMA

d. CPA

e. CPA

f. CMA

g. CMA, CPA, CIA

h. CMA, CPA, CIA

PROBLEMS

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1. Excellence teams and minicompanies both have the objective of involving produc-

tion line personnel more fully in the management process so that the company can take advantage of the direct contact and knowledge that operating workers have about production and their work environment. This will hopefully translate into con-tinuous improvement of operating performance. The objectives seem to be rea-lized. Duffy has increased profits and reduced costs, attributing much of the change to the contributions of the excellence teams. The same is true for the minicompa-nies—much of the success in quality improvements appears to be grounded in this organizational change.

2. Employee empowerment is a key element of continuous improvement. Operating

workers have tremendous skills, knowledge, and firsthand contact with the operat-ing environment, all of which can be exploited to discover new and more efficient ways of producing. As employees are allowed more input, their self-esteem grows and their commitment to the company increases. Morale also increases, making for

a more pleasant and productive environment. There are potential disadvantages.

Too much latitude in employee empowerment might sidetrack employees to the point where they begin to attack personalities; discuss and argue about wage and hour considerations (or other grievances); or try to become involved in hiring, firing, and disciplinary matters. Many of these matters are best left centralized, and some skillful management is needed to ensure that operating employees are primarily in-volved in improving efficiency.

3. Management accounting information should be used to inform empowered em-

ployees so that they can identify problems and monitor and evaluate the effects of decisions they make.

4. Quality culture means that the employees of the organization have an internal

commitment to producing high-quality products and services. A learning organiza-tion means that the employees are always seeking new and better ways of doing things—they have a commitment to continuous improvement.

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1. The total product is the product and its features (processing speed, disk drives,

software packages, and so on), the service, the operating and maintenance re-quirements, and the delivery speed.

2. One company is emphasizing low costs, and the other is attempting to differentiate

its PC by offering faster delivery and higher-quality service.

3. The Confiar’s service component and its delivery time appear to be better than

Drantex’s. Thus, the realization of these features appears to outweigh the additio n-al sacrifice (the additional operating and maintenance cost) associated with the Confiar PC. The implications for management accounting are straightforward. The management accounting information system should collect and report information

about customer realization and sacrifice. Much of this information is external to the firm but clearly needed by management.

4. Better quality and shorter delivery time increase customer realization, while lower-

ing the price decreases customer sacrifice. In total, customer value has increased and presumably this should make the Drantex PC much more competitive. This ex-ample illustrates how quality, time, and costs are essential competitive weapons. It also illustrates how critical it is that the management accounting system collect and report data concerning these three dimensions.

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Planning. The management accountant gains an understanding of the impact on the organization of planned transactions (i.e., analyzing strengths and weaknesses) and economic events, both strategic and tactical, and sets obtainable goals for the organiza-tion. The development of budgets is an example of planning.

Controlling. The management accountant ensures the integrity of financial information, monitors performance against budgets and goals, and provides information internally for decision making. Comparing actual performance against bud-geted performance and taking corrective action where necessary is an example of controlling. Internal au-diting is another example.

Evaluating Performance. The management accountant judges and analyzes the impli-cations of various past and expected events and then chooses the optimum course of action. The management accountant also translates data and communicates the con-clusions. Graphical analysis (such as trend, bar charts, or regression) and reports com-paring actual costs with budgeted costs are examples of evaluating performance. Ensuring Accountability of Resources. The management accountant implements a re-porting system closely aligned to organizational goals that contributes to the measure-ment of the effective use of resources and safeguarding of assets. Internal reporting such as comparison of actual to budget is an example of accountability.

External Reporting. The management accountant prepares reports in accordance with generally accepted accounting principles and then disseminates this information to shareholders, creditors, and regulatory and tax agencies. An annual report or a credit application are examples of external reporting. (CMA adapted)

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The changes that are being proposed violate the following ethical standards: Competence. Top management’s request of Roger Deerling to account for the comp a-ny’s information in a manner that is not in accordance with generally accepted accoun t-ing principles is in violation of the standard to ―perform professional duties in acco r-danc e with relevant laws, regulations, and technical standards.‖ Also, top management’s restriction on information disclosure has violated the standard to ―pr e-pare complete and clear reports.‖

Confidentiality. Top management has violated the ethical standard o f ―refraining from using confidential information acquired in the course of their work for unethical or illegal advantage personally‖ (personal job security).

Integrity. Top management clearly is in violation of the standard ―to avoid actual or a p-parent conflicts of interest and advise all appropriate parties (other shareholders) of any potential conflict.‖

The motivation for top management in this circumstance appears to be reinforced by the favorable bonus situation, which is in violation of the standard ―to refuse any gift or favor (bonus) that would influence or appear to influence their ac tions.‖

By telling Deerling to restrict the disclosure of the changes, top management is clearly in violation of the standard ―to communicate unfavorable as well as fa vorable informa-tion.‖

Objectivity. Top management’s restriction and distortion of Alert’s financial information violates the standard to ―communicate information fairly and objectively.‖

To resolve the ethical dilemma, Roger Deerling should first determine if the company has an established policy in place. If so, he should follow the prescribed policies in re-solving the ethical conflict. If there is no policy, then the specific steps are as follows:

?To confront top management about the unethical behavior unless Deerling believes they are involved, in which case the problem should be presented to the next higher level, the chairman of the board of directors. If this fails, then the issue can be taken to the audit committee and the board of directors.

?To clarify relevant concepts by confidential discussion with an objective advisor to obtain possible courses of action.

?To resign and submit an informative memorandum to the chairman of the board of directors, if all levels of internal review have been exhausted and the conflict still exists. (CMA adapted)