MANAGERIAL ACCOUNTING F/MGRS.
5th Edition
ISBN: 9781259969485
Author: Noreen
Publisher: RENT MCG
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Chapter 11, Problem 11.1Q
To determine
Concept introduction:
A business may have a centralized or decentralized structure. A centralized structure of the business merges all the responsibilities in one place and in the case of decentralized structure the responsibilities are allocated to different centers.
To indicate: The meaning of decentralization.
Expert Solution & Answer
Explanation of Solution
A business needs to define the responsibilities of its business processes and centers. A business may have a centralized or decentralized structure.
Under the centralized structure, the responsibilities of all centers are kept at one place and management is responsible for all processes and centers.
In the case of a decentralized structure, the responsibilities are allocated to different centers for example; profit center, investment center, cost center, etc. The manager of each center is held responsible for the center.
Hence, decentralization is a technique to allocate the responsibilities of business centers.
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Let's say that Dr. Tim’s Company purchased a heavy-duty truck on July 1, 2021, for $30,000. It was estimated that it would have a useful life of 10 years and then would have a trade-in value of $6,000. The company uses the straight-line method. It was traded on August 1, 2026, for a similar truck costing $42,000; $16,000 was allowed as trade-in value (also fair value) on the old truck and $26,000 was paid in cash. A comparison of expected cash flows for the trucks includes the exchange lacks commercial substance.
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Chapter 11 Solutions
MANAGERIAL ACCOUNTING F/MGRS.
Ch. 11 - Prob. 11.1QCh. 11 - Prob. 11.2QCh. 11 - Prob. 11.3QCh. 11 - Prob. 11.4QCh. 11 - Prob. 11.5QCh. 11 - Prob. 11.6QCh. 11 - Prob. 11.7QCh. 11 - Prob. 11.8QCh. 11 - Prob. 11.9QCh. 11 - Prob. 11.10Q
Ch. 11 - Prob. 1AECh. 11 - Prob. 1TF15Ch. 11 - Prob. 11.1ECh. 11 - Prob. 11.2ECh. 11 - Prob. 11.3ECh. 11 - Prob. 11.5ECh. 11 - Prob. 11.6ECh. 11 - Prob. 11.8ECh. 11 - Prob. 11.9ECh. 11 - Prob. 11.10ECh. 11 - Prob. 11.11ECh. 11 - Prob. 11.12ECh. 11 - Prob. 11.13ECh. 11 - Prob. 11.14PCh. 11 - Prob. 11.15PCh. 11 - Prob. 11.17PCh. 11 - Prob. 11.18PCh. 11 - Prob. 11.19PCh. 11 - Prob. 11.20P
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