Test bank ofr is class

http://www.scribd.com/doc/40083437/MIS10E-testbank-CH01

Hello Professor and class! My name is Juan Banegas, I presently live and work in Sacramento CA. I am currently pursuing an MBA in Business, with a project management emphasis and I look forward to this class.

Yes, I agree with others in the class that income statements differ depending on the type of company. I know that accounting textbooks generally focus on manufacturers and merchandisers which commonly discuss material costs, rent, costs of goods sold, etc. For those not familiar with the insurance industry, the income statement is much different. Revenue consists of premiums, investment income, investment gains, and product fees; Expenses include changes to reserves, interest credited, operating expenses, etc. In a service industry where you're not necessarily providing a tangible good, the items that make up the income statement are quite different from a manufacturer or merchandiser.

Would a traditional income statement differ depending on whether the business is a service organization, merchandiser, or manufacturer? Yes, a traditional income statement would differ whether it had cost of goods sold. For instance, a merchandising industry such Hardware store and a manufacturing company like GoodYear tires will both have cost of goods sold since they sell a product. On the other hand, service firms such as AT&T or UPS will not have this cost or a subtotal for gross profit. Would a traditional income statement differ depending on whether the business is a service organization, merchandiser, or manufacturer? Yes, it would differ in one respect - whether it had cost of goods sold. Merchandising (like Ace Hardware) and manufacturers (like Tyson Chicken) will have cost of goods sold since they sell a product. Service firms (like Google) will not have this cost or a subtotal for gross profit. Otherwise they are similar. Could we use managerial accounting "tools" to assess the profitability of an organization other than a manufacturing business, or are the topics we are learning only related to manufacturing? If we could use these concepts in service and/or merchandising businesses, how would we go about doing so?

Most definitely, managerial accounting tools can be used for any type of business. For non-manufacturing firms, you can use return on assets and residual income to evaluate all firms. Moreover, management can assign business costs using activity based costing. For instance, management can use them to apportion supplies travel and to divisions or customers based on trips and number of reports. More specifically, you can use activities to spread costs to any cost object, despite of the firm's product or organization.
Firms that have repetitive processes, ones that should be done the same each time, can use standard costing, even if they are not manufacturing. This permits them to monitor the process and isolate variances that need follow up. Think about a tile installer. It should take a certain amount of time to lay tile, right? You can set up standards for this. What about nofault divorces. They should be all the same - same paperwork, same procedures. You could create a standard and track variances. For return on assets, any firm can use this performance measure. All you need is their traditional financial statements. Same for residual income and a balanced scorecard. You need a hurdle rate and some strategic goals and then you can

create these tools.

Your response is 293 words and shows how managerial techniques can be used in retail and service firms. Examples are given.

A great strategy used by Blue Nile is the offering of a wide array of products; a great strategy to take advantage of the emarket. Nevertheless, many customers will buy online because the products are less pricy, and often times the collection of goods is larger, and products can be shipped directly to their households. What its more, less expensive items tend have lower shipping and handling, which its always a great incentive for any online shopper.

Conclusion Technological changes and increasingly aggressive use of information systems by businesses have several consequences. Technology affects individuals, their jobs, educational systems, governments, and society as a whole. Although computers and MIS contribute a lot to business and e-commerce, managers need to understand how businesses, technology, and society interact. Dealing with changes in privacy and security threats are increasingly important to managing a company. Evaluating changes in society also gives a manager an advantage in the marketplace. As citizens, managers should be aware of the negative and positive effects of technology. In particular, changes in technology can often lead to changes in political power and control. As a manager and a citizen, you are obligated to make ethical decisions and to understand the consequences of your actions. Increasing dependence on technology brings with it new threats to the security of the firm. Managers need to recognize and evaluate these threats and understand some of the techniques used to minimize them. The most common threats come from inside the company, in terms of workers, consultants, and business partnerships. These are difficult to control because firms have to trust these individuals to do their jobs. Training, oversight, audits, and separation of duties are common means to minimize threats. Depending on the communication systems used, there are threats from outsiders and viruses that can access computers with modems, over networks, or by intercepting communications. Dial-back modems, access controls, encryption, and antivirus software are common techniques to combat these threats.