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Managerial Accounting for Managers

SOLUTIONS MANUAL
to accompany

MANAGERIAL
ACCOUNTING
FOR MANAGERS
Second Edition

Eric W. Noreen
Peter C. Brewer
Ray H. Garrison

McGraw-Hill/Irwin
Burr Ridge, Illinois

Managerial Accounting for Managers

Contents
Problem and Case Material Scaled as to Difficulty.....................................

iv

Chapter 1 Managerial Accounting and the Business Environment...........

Chapter 2 Managerial Accounting and Cost Concepts..............................

19

Chapter 3 Cost Behavior: Analysis and Use.............................................

65

Chapter 4 Cost-Volume-Profit Relationships.............................................

121

Chapter 5 Systems Design: Job-Order Costing.........................................

199

Chapter 6 Variable Costing: A Tool for Management...............................

255

Chapter 7 Activity-Based Costing: A Tool to Aid Decision Making............

297

Chapter 8 Profit Planning..........................................................................

345

Chapter 9 Flexible Budgets and Performance Analysis............................

403

Chapter
10
Chapter
11
Chapter
12
Chapter
13
Appendix
A
Appendix
B

Standard Costs and Operating Performance Measures...........

445

Segment Reporting, Decentralization, and the Balanced


Scorecard.................................................................................
Relevant Costs for Decision Making.........................................

519

Capital Budgeting Decisions....................................................

679

Pricing Products and Services..................................................

749

Profitability Analysis................................................................

773

613

Managerial Accounting for Managers

Problem and Case Material Scaled as to Difficulty


Each exercise, problem, and case in the text has been rated below as Basic, Medium, or
Difficult.
Basic: Straightforward application of concepts, with few extraneous or complicating
factors.
Medium: More rigorous application of concepts than in basic problems. Extraneous
material may be present and the student may have to use concepts in ways not specifically
illustrated in the text. It is not necessary to go beyond this level to give students
challenging and thought-provoking homework.
Difficult: Unusually rigorous application of concepts that often includes extraneous data.
Chapter 1
Chapter 2
Chapter 3
Appendix
3A
Chapter 4
Chapter 5
Appendix
5A
Chapter 6
Chapter 7
Appendix
7A
Chapter 8
Chapter 9
Chapter 10
Chapter
10A
Chapter 11
Appendix
11A
Appendix
11B
Chapter 12
Chapter 13

1, 2, 3, 4

5, 6

Difficult
9
24, 25, 26, 27,
28
15, 16, 17, 18,
20
7, 8

1, 2, 3,
13, 14,
22
1, 2, 3,
13, 14,
1, 2

4, 5, 6, 7, 8, 9, 10, 11, 12,


15, 16, 17, 18, 19, 20, 21,

23, 24, 25, 26, 28,


29

27, 30, 31, 32,


33, 34

4, 5, 6, 7, 8, 9, 10, 11, 12,


17, 18, 22

15, 16, 19, 20, 21,


23, 24
3

25, 26, 27, 28

1, 2, 3, 5, 6, 7, 8, 9, 10, 11, 12

4, 13, 14, 15

1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12,


14, 15
1, 2, 3, 4

13, 17, 18, 19

16, 17, 18, 19,


20
16, 20

1, 2, 3,
13, 14,
22, 23
1, 2, 3,
13, 14,
1, 2, 3,
13, 14,
1, 2, 3,

4, 5, 6, 7, 8, 9, 10, 11, 12,


15, 16, 17, 18, 19, 20, 21,

24, 25, 26, 27, 28

29, 30, 31

4, 5, 6, 7, 8, 9, 10, 11, 12,


15, 16, 17, 18, 19, 23
4, 5, 6, 7, 8, 9, 10, 11, 12,
15
4, 5, 6, 7, 8, 9, 10

20, 21, 22, 24, 27

25, 26, 28

16, 17

18, 19, 20, 21,


22, 23

1, 2, 3,
1, 2, 3,
13, 14,
1, 2, 3,

Basic
4, 5
4, 5, 6, 7, 8, 9, 10, 11, 12,
15
4, 5, 6, 7, 8, 9, 10, 11, 12

Medium
6, 7, 8
16, 17, 18, 19, 20,
21, 22, 23
13, 14, 19

11, 12

1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12,


13, 14, 15, 16, 17, 18
1, 2, 3

19, 20, 21, 22, 23,


24, 25, 26, 27
4, 5, 6

1, 2, 3, 4

1, 2, 3,
13, 14,
1, 2, 3,
13, 14,

19,
24,
22,
27,
32,

4, 5, 6, 7, 8, 9, 10, 11, 12,


15, 16, 17, 18
4, 5, 6, 7, 8, 9, 10, 11, 12,
15, 16, 17, 18, 19, 20, 21

20,
25,
23,
28,
33

21, 22, 23,


32
24, 25, 26,
29, 30, 31,

28, 29, 30, 31


7

26, 27, 28, 29,


30, 31
34, 35

Managerial Accounting for Managers

Appendix
13A
Appendix
13C
Appendix A
Appendix B

1, 2, 3, 4, 5, 6
1, 2, 3, 4

5, 6

1, 2, 3
1, 2, 3

4, 5
4, 6, 7

6, 7, 8
5, 8

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