Log out Go to App
Go to App

Learning Materials

Features

Discover

Chapter 16: 16-1SE_a (page 885)

Comparing managerial accounting and financial accounting

For each of the following, indicate whether the statement relates to managerial accounting (MA) or financial accounting (FA):

  1. Helps investors make investment decisions

Short Answer

Expert verified

Investment is something acquired with the motive of generating income and a financial statement is a correct option for this.

Step by step solution

01

Definition of Investment

The Investment is defined as the asset or any other item which is acquired with the purpose of generating some revenue in the future

02

Indication of accounting

The correct answer for this statement is financial accounting.

Explanation:

Financial accounting is used in this statement. This is because the investors will require a financial statement to assess the company whether the company is good for investing or not.

Unlock Step-by-Step Solutions & Ace Your Exams!

  • Full Textbook Solutions

    Get detailed explanations and key concepts

  • Unlimited Al creation

    Al flashcards, explanations, exams and more...

  • Ads-free access

    To over 500 millions flashcards

  • Money-back guarantee

    We refund you if you fail your exam.

Start your free trial

Over 30 million students worldwide already upgrade their learning with Vaia!

One App. One Place for Learning.

All the tools & learning materials you need for study success - in one app.

Get started for free

Most popular questions from this chapter

Identifying product costs and period costs Classify each cost of a paper manufacturer as either a product cost or a period cost:

a. Salaries of scientists studying ways to speed forest growth.

Preparing an income statement and calculating unit cost for a merchandising company

Clyde Conway owns Clyde’s Pets, a small retail shop selling pet supplies. On December 31, 2018, the accounting records of Clyde’s Pets showed the following:

Merchandise Inventory on December 31, 2018 $ 10,100

Merchandise Inventory on January 1, 2018 15,900

Net Sales Revenue 56,000

Utilities Expense for the shop 3,300

Rent for the shop 4,100

Sales Commissions 2,650

Purchases of Merchandise Inventory 25,000

Requirements

1. Prepare an income statement for Clyde’s Pets for the year ended December 31, 2018.

2. Clyde’s Pets sold 3,850 units. Determine the unit cost of the merchandise sold, rounded to the nearest cent

Identifying ethical standards

The Institute of Management Accountants’ Statement of Ethical Professional Practice requires managerial accountants to meet standards regarding competence, confidentiality, integrity, and credibility. Consider the following situations. Which standard(s) is(are) violated in each situation?

b. You see others take home office supplies for personal use. As an intern, you do the same thing, assuming that this is a “perk.”

Computing cost of goods manufactured and cost of goods sold

Use the following information for a manufacturer to compute cost of goods manufactured and cost of goods sold:

Balances: Beginning Ending

Direct Materials \( 27,000 \) 28,000

Work-in-Process Inventory 40,000 32,000

Finished Goods Inventory 18,000 25,000

Other information:

Purchases of direct materials $ 73,000

Direct labor 88,000

Manufacturing overhead 43,000

Question:Preparing a schedule of cost of goods manufactured and an income statement for a manufacturing company

Gourmet Bones manufactures its own brand of pet chew bones. At the end of December 2018, the accounting records showed the following:

Balances: Beginning Ending

Direct Materials \( 13,500 \) 7,500

Work-in-Process Inventory 0 3,500

Finished Goods Inventory 0 5,200

Other information:

Direct materials purchases$ 36,000

Plant janitorial services 700

Sales salaries 6,000

Delivery costs1,300

Net sales revenue 107,000

Utilities for plant 1,300

Rent on plant 17,000

Customer service hotline costs 1,200

Direct labor23,000

Requirements

1. Prepare a schedule of cost of goods manufactured for Gourmet Bones for the year ended December 31, 2018.

2. Prepare an income statement for Gourmet Bones for the year ended December 31, 2018.

3. How does the format of the income statement for Gourmet Bones differ from the income statement of a merchandiser?

4. Gourmet Bones manufactured 17,900 units of its product in 2018. Compute the company’s unit product cost for the year, rounded to the nearest cent.
See all solutions

Recommended explanations on Business Studies Textbooks

Introduction to Business

Read Explanation

Intermediate Accounting

Read Explanation

Financial Performance

Read Explanation

Human Resources

Read Explanation

Managers

Read Explanation

Nature of Business

Read Explanation
View all explanations

What do you think about this solution?

We value your feedback to improve our textbook solutions.

Study anywhere. Anytime. Across all devices.

Sign-up for free