Questions from Cost Accounting

Q: Refer to the data in Problems 14-49 and 14-

Refer to the data in Problems 14-49 and 14-50. The manager of the Canal Division complains that the calculation of EVA is unfair because a much longer life is assumed for the Lake Division in calculat...

Q: Refer to the information in Problem 14-52. The manager

Refer to the information in Problem 14-52. The manager is still assessing the problem of whether to acquire SSM’s assembly machine. SSM tells the manager that the new machine could b...

Q: Refer to the facts in Problem 14-52. Assume that

Refer to the facts in Problem 14-52. Assume that the performance measurement and bonus plans at Leidich Corporation are based on residual income instead of ROI. The company uses a cost of capital of 1...

Q: Surveying the accounts payable records, a clerk in the controller’s office

Surveying the accounts payable records, a clerk in the controller’s office noted that expenses appeared to rise significantly within one month of the close of the budget period. The organization did n...

Q: Refer to the facts in Problem 14-52 through 14-

Refer to the facts in Problem 14-52 through 14-54. Assume that the Leidich Corporation performance measurement and bonus plans are based on residual income instead of ROI. The company uses a cost of c...

Q: Division managers at Lesure, Inc. are granted a wide range

Division managers at Lesure, Inc. are granted a wide range of decision authority. With the exception of managing cash, which is done at corporate headquarters, divisions are responsible for sales, pri...

Q: Technology firms, pharmaceutical firms, oil and gas companies, and

Technology firms, pharmaceutical firms, oil and gas companies, and other ventures inevitably incur costs on unsuccessful investments in new projects (e.g., new technologies or new drugs). For oil and...

Q: Vermont Automotive is a regional chain of auto parts stores. The

Vermont Automotive is a regional chain of auto parts stores. The managers of the individual stores are evaluated using ROI. Vermont requires managers to earn an ROI of at least 10 percent of assets. T...

Q: Bentler Industries provides high-technology navigation and communication equipment for the

Bentler Industries provides high-technology navigation and communication equipment for the aerospace and shipbuilding industries. It is organized into two divisions, Aeronautics and Marine. The divisi...

Q: Refer to the information in Problem 14-63. Looking at

Refer to the information in Problem 14-63. Looking at the ROI results for year 3, the president of Aeronautics Division complains that the division is evaluated unfairly because of the accounting rule...