Questions from Cost Accounting

Q: The managers and partners [who] were interviewed listed reduced manpower

The managers and partners [who] were interviewed listed reduced manpower costs as the major advantage for utilizing paraprofessionals [in CPA firms]. It seems that these savings were realized in a num...

Q: Sue and Jim Hansen are preparing their household financial budget for December

Sue and Jim Hansen are preparing their household financial budget for December. They have started with their November budget and are adjusting it to reflect the difference between November and Decembe...

Q: Lucy Liu has been asked to monitor the efficiency and effectiveness of

Lucy Liu has been asked to monitor the efficiency and effectiveness of a newly installed machine. The specialized machine has been guaranteed by the manufacturer to package 2,000 engine gaskets per ki...

Q: Top management of Capital Services observed that the budget for the EDP

Top management of Capital Services observed that the budget for the EDP department had been growing far beyond what was anticipated for the past several years. Each year, the EDP manager would demonst...

Q: The founder and president of the Institute for Healthcare Improvement, Donald

The founder and president of the Institute for Healthcare Improvement, Donald Berwick, is convinced that the U.S. health-care system can reduce costs by 30 percent while improving overall quality—just...

Q: Birmingham Chemical evaluates performance in part through the use of flexible budgets

Birmingham Chemical evaluates performance in part through the use of flexible budgets. The selling expense budgets at three activity levels within the relevant range follow. The following assumptions...

Q: Multinational firms domiciled in the United States do not have to pay

Multinational firms domiciled in the United States do not have to pay U.S. income taxes on foreign earnings, unless those earnings are returned to the United States. Accordingly, the U.S. income tax s...

Q: As the economy entered the new millennium, Internet companies were competing

As the economy entered the new millennium, Internet companies were competing head to head in many markets with established, traditional retailers for the consumer’s dollar. In comparing the financial...

Q: Jose Martin founded a firm that manufactures innovative toys. Since its

Jose Martin founded a firm that manufactures innovative toys. Since its founding in 2000, the firm has experienced steady growth. However, in the past six months, the firm’s products were featured on...

Q: Open-book management is consistent with another, larger trend in

Open-book management is consistent with another, larger trend in accounting—increased transparency of financial results. This trend follows a period in which many U.S. firms were guilty of generating...