Principles of Cost Accounting

569 Pages·2009·4.8 MB·English

by  Edward J. Vanderbeck

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R I N C I P L E S O F
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E
E J . V D
D W A R D A N E R B E C K
Professor Emeritus
Department of Accountancy
Xavier University
PrinciplesofCostAccounting,15thEdition ª2010,2008South-Western,CengageLearning
EdwardJ.VanDerbeck
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REFACE
Why Study Cost Accounting?
The 15th edition of Principles of Cost Accounting, in an easily accessible
presentation, applies cost concepts, cost behavior, and cost accounting
techniques to manufacturing, merchandising, and service businesses. Stu-
dents learn how to determine costs of products and services more accu-
rately; use the knowledge of product and service costs to set selling prices,
to bid on contracts, and to analyze the relative profitability of various
products and services; use techniques to measure the performance of
managersandsubunitswithinanorganization;designanaccountingsystem
tofittheproductionanddistributionsystemofanorganization;andusethe
accounting system as a tool to motivate managers towards the organiza-
tion’sgoals.
What Does the 15th Edition Offer?
. Appropriate content for a one-quarter or one-semester cost accounting
course.
. A ten-chapter format—a distinguishing feature of the text that makes it
mostappropriateforshortercourses.
. Directedassignmentsatintervalswithineachchapter.
. A very readable and relevant text that covers the essentials of cost
accountinginalogicalsequenceandconcisemanner.
. Theinclusionofcostaccountingtechniquesforservicebusinesses.
. A discussion of the special purpose reports and analytical techniques
usedformanagementdecisionmaking.
. Emphasis on nonfinancial performance measures via the balanced
scorecard.
. An increase in the number of end-of-chapter exercises, problems, and
Self-StudyProblems.
vi PrinciplesofCostAccounting
What Is New in the 15th Edition?
The15theditionincludesthefollowingchanges:
. Allnewchapter-openingvignetteswithreal-worldapplications.
. Increased use of graphics, including Excel spreadsheet ‘‘screen shots’’
andflowdiagrams.
. Anincreaseinthenumberofend-of-chapterself-studyproblems.
. An increased emphasis on ethical decision making in the end-of-chapter
Mini-Cases.
. Newlyadded‘‘realcompany’’examplesthroughoutthetext.
. First-time inclusion of corporate governance, lean manufacturing, de-
mandsoftware,andWeb-basedbudgeting.
. Anintegratedillustrationofmaterialscontrolprocedures.
. An illustration of the least squares regression method using Microsoft
Excel.
What Are the Features of the 15th Edition?
The 15th edition includes several features that facilitate the learning
processforthestudentandallowtheinstructortoteachwithease.
Directed Assignments
At specific points within each chapter, students are directed to appropriate
end-of-chapter assignments. This allows students to work practice items
withoutcompletingtheentirechapter.
Self-Study Problems
Two demonstration problems are included at the end of each chapter, with
a step-by-step explanation of how to solve them. These Self-Study Pro-
blems are constructed from difficult concepts in the chapter and reinforce
thetechniquesandproceduresdiscussed inthechapter.Anaddedfeatureis
end-of-chapter problems that reference students back to Self-Study Pro-
blemsthataresimilarintopicanddifficulty.
End-of-Chapter Materials
Theend-of-chapterquestions,exercises,problems,mini-cases,andInternet
activities have been carefully written, revised, added to, and verified to
reflect the coverage as it appears in the chapters. There has been a
concerted effort to provide the instructor with a wide choice of subject
matter and degree of difficulty when assigning end-of-chapter materials.
Where appropriate, comprehensive review problems have been added that
cover concepts from more than one chapter. Additionally, selected pro-
blemsmaybesolvedusingspreadsheetsoftware.
Preface vii
Integrated Learning Objectives
Learningobjectivesbegineachchapter.Eachlearningobjectiveisindicated
in the text where first discussed. All end-of-chapter exercises, problems,
mini-cases,andInternetactivitiesareidentifiedbylearningobjectives.
Key Terms
Key terms are highlighted as they are introduced. They are listed, along
with page references, at the end of each chapter. A comprehensive glossary
is included at the end of the book, providing definitions for all the key
terms. Actualcompanies arehighlighted where theirpractices arediscussed
inthechapters.
Appendixes
The Institute of Management Accountants ‘‘Statement of Ethical Profes-
sional Practice’’ is included in an appendix at the end of Chapter 1. An
appendix at the end of Chapter 9 illustrates the four-variance and three-
variancemethodsofanalyzingfactoryoverhead.
What Supplementary Materials Are Available?
A complete package of supplementary materials is available with the 15th
editionofPrinciplesofCostAccountingtoassistbothinstructorsandstudents.
The package includes materials that have been carefully prepared and
reviewed.
Available to Instructors
AllinstructorresourcesareavailableonlineontheInstructorCompa-
nion Web Site (www.cengage.com/accounting/vanderbeck), as well as
ontheInstructorResourceCD-ROM(IRCD).
Solutions Manual. This manual contains the answers to all end-of-chapter
questions,exercises,problems,Internetexercises,andmini-cases.
Test Bank. The test bank is available in a computerized version for
Windows.Theusermayselect,mix,edit,andaddquestionsorproblemsto
createthetypeoftestorproblemsetneeded.
ExamView ProTM Testing Software. The printed test bank is available in a
computerizedversionforWindows.Theusermayselect,mix,edit,andadd
questions or problems to create the type of test or problem set needed.
ExamViewisavailableontheInstructor’sResourceCD.
PowerPoint Presentations. This resource provides presentations for each
chapter, created specifically for this edition; thus, they follow along closely
viii PrinciplesofCostAccounting
with the text. The presentations for each chapter are also available online
forstudentstouseasanadditionalstudyresource.
Instructor Resource CD-ROM (IRCD). This convenient resource includes
the Test Bank, ExamView, the Solutions Manual, PowerPoint Presenta-
tions,andtheInstructorSpreadsheetTemplates(withsolutions).
InstructorSpreadsheetTemplates.The Instructor Spreadsheet Templates
show the completed spreadsheet solutions for exercises within the end-of-
chapter materials. These files are available on the IRCD, or they can be
downloadedfromtheInstructorCompanionWebSite.
Instructor Companion Web Site (www.cengage.com/accounting/vander-
beck).The text-specific Web site provides access to all instructor resources
organized by chapter and topic, and are password protected. All of these
resources are also available on the IRCD: Test Bank, ExamView, Solutions
Manual, PowerPoint Presentations, and the Instructor Spreadsheet Tem-
plates(withsolutions).
Available to Students
All student resources are available online on the Student Companion
WebSite(www.cengage.com/accounting/vanderbeck).
StudyGuide.The study guide provides a review summary for each chapter
as well as questions and problems to test comprehension of chapter
material.Solutionsforallquestionsandproblemsareincludedinaseparate
sectionattheendofthestudyguide.
Student Spreadsheet Templates. The Student Spreadsheet Templates
correlate to exercises within the end-of-chapter materials. These files are
availablefordownloadingontheStudentCompanionWebSite.
PowerPoint Presentations. This study resource provides presentations for
each chapter, created specifically for this edition; thus, they follow along
closelywiththetext.
ExperienceAccountingVideos.Highlightprogressivecompaniesandallow
you to effectively visualize critical chapter concepts—enhancing what you
learn in class! The Experience Accounting Videos can be bundled at no
additional cost with new copies of the text or can be purchased separately. You
canaccessthevideosatwww.cengage.com/accounting/eav.
Preface ix
Acknowledgments
We would like to thank all ofthose individuals whohave helped during the
revisionofthistextbyprovidingconstructivecommentsandsuggestions.
JosephineM.Mathias
MercerCountyCommunityCollege
JoanneE.Shurbert
Concord’sCommunityCollegeandManchesterCommunityCollege
AnnBikofsky
CollegeofWestChester
TheresaLaws-Dahl
BlackhawkTechnicalCollege
SamLester
MiddleGeorgiaTechnicalCollege
EdwardKufuor
ASAInstitute
JimMurray
WesternTechnicalCollege
DavidA.Flannery
Bryant&StrattonCollege,VirginiaBeach
JamesEmig
VillanovaUniversity