1 Introduction To Cost Management 2 Basic Cost Management Concepts 3 Cost Behavior 4 Activity-based Costing 5 Product And Service Costing: Job-order System 6 Process Costing 7 Allocating Costs Of Support Departments And Joint Products 8 Budgeting For Planning And Control 9 Standard Costing: A Functional-based Control Approach 10 Decentralization: Responsibility Accounting, Performance Evaluation, And Transfer Pricing 11 Strategic Cost Management 12 Activity-based Management 13 The Balanced Scorecard: Strategic-based Control 14 Quality And Environmental Cost Management 15 Lean Accounting And Productivity Measurement 16 Cost-volume-profit Analysis 17 Activity Resource Usage Model And Tactical Decision Making 18 Pricing And Profitability Analysis 19 Capital Investment 20 Inventory Management: Economic Order Quantity, Jit, And The Theory Of Constraints Chapter10: Decentralization: Responsibility Accounting, Performance Evaluation, And Transfer Pricing
Chapter Questions Section: Chapter Questions
Problem 1DQ Problem 2DQ: Explain why firms choose to decentralize. Problem 3DQ: Explain how access to local information can improve decision making. Problem 4DQ: What are margin and turnover? Explain how these concepts can improve the evaluation of an investment... Problem 5DQ: What are the three benefits of ROI? Explain how each can lead to improved profitability. Problem 6DQ: What are two disadvantages of ROI? Explain how each can lead to decreased profitability. Problem 7DQ: What is residual income? Explain how residual income overcomes one of ROIs disadvantages. Problem 8DQ Problem 9DQ Problem 10DQ: What is a transfer price? Problem 11DQ Problem 12DQ: If the minimum transfer price of the selling division is less than the maximum transfer price of the... Problem 13DQ: If an outside, perfectly competitive market exists for the intermediate product, what should the... Problem 14DQ Problem 15DQ Problem 1CE: Forchen, Inc., provided the following information for two of its divisions for last year: Required:... Problem 2CE: Refer to Cornerstone Exercise 10.1. Forchen, Inc., requires an 8 percent minimum rate of return.... Problem 3CE: Ignacio, Inc., had after-tax operating income last year of 1,196,500. Three sources of financing... Problem 4CE Problem 5CE Problem 6CE Problem 7E: Jarriot, Inc., presented two years of data for its Furniture Division and its Houseware Division.... Problem 8E: Refer to Exercise 10.7 for data. At the end of Year 2, the manager of the Houseware Division is... Problem 9E: Refer to the data given in Exercise 10.8. Required: 1. Compute the residual income for each of the... Problem 10E: Brewster Company manufactures elderberry wine. Last year, Brewster earned operating income of... Problem 11E: Xenold, Inc., manufactures and sells cooktops and ovens through three divisions: Home, Restaurant,... Problem 12E Problem 13E: Jocassee Furniture Manufacturing, Inc., has a division in the United States that produces and sells... Problem 14E Problem 15E: Mossfort, Inc., has a division in Canada that makes long-lasting exterior wood stain. Mossfort has... Problem 16E: A multinational corporation has a number of divisions, two of which are the North American Division... Problem 17E: Consider the data for each of the following four independent companies: Required: 1. Calculate the... Problem 18E: The following selected data pertain to the Argent Division for last year: Required: 1. How much is... Problem 19E Problem 20E: The key difference between residual income and EVA is that EVA a. uses the actual cost of capital... Problem 21E: If sales and average operating assets for Year 2 are identical to their values in Year 1, yet... Problem 22E Problem 23E: Refer to 10.22. If the imputed interest rate is 6%, what is Anders Company residual income for the... Problem 24E: A company had WACC (weighted average cost of capital) equal to 8. % If the company pays off mortgage... Problem 25P Problem 26P: Raddington Industries produces tool and die machinery for manufacturers. The company expanded... Problem 27P Problem 28P Problem 29P: Oriole, Inc., owns a number of food service companies. Two divisions are the Coffee Division and the... Problem 30P Problem 31P Problem 32P: Renslen, Inc., a truck manufacturing conglomerate, has recently purchased two divisions: Meyers... Problem 33P: Jump Start Company (JSC), a subsidiary of Mason Industries, manufactures go-carts and other... Problem 34P Problem 35P: Grate Care Company specializes in producing products for personal grooming. The company operates six... Problem 6DQ: What are two disadvantages of ROI? Explain how each can lead to decreased profitability.
Negative profitability index.
Definition Definition Calculation used to evaluate the investment and financing decisions that involve cash flows occurring over multiple periods. NPV is calculated as the difference between the present value of cash inflow and cash outflow. NPV is used for capital budgeting and investment planning as well as to compare similar investment alternatives.
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