Chapter 1 Homework

Management accountants need a wide variety of skills for their roles in organizations. These skills can be classified as either technical or nontechnical. Requirement For each of the following​ skills, indicate whether it is a technical competency or a nontechnical competency for a management accountant.

a. Leadership Nontechnical b. Communication Nontechnical c. Collaboration Nontechnical d. Internal controls Technical e. Change management Nontechnical f. Cost management Technical g. Investment decision making Technical h. Technology Technical i. Customer service Nontechnical j. Financial statement analysis Technical k. Business acumen Nontechnical l. Performance management Technical m. Adaptability Nontechnical n. Enterprise risk management Technical o. Planning, budgeting, and forecasting Technical p. Decision analysis Technical q. Internal financial reporting Technical r. Ethics Nontechnical s. Process improvement Nontechnical t. Strategic thinking Nontechnical

Complete the following statements with one of the terms listed here. You may use a term more than​ once, and some terms may not be used at all. The options are budget, creditors, managerial accounting, planning, controlling, financial accounting, managers or stakeholders

a. US companies must follow GAAP (or International Financial Reporting Standards, IFRS, in the case of companies headquartered in many countries outside of the United States) in their financial accounting systems. b. Financial accounting develops reports for external parties such as shareholders and creditors c. When managers evaluate the company's performance compared to the plan, they are performing the controlling role of management. d. Managers are decision makers inside a company. e. Financial accounting provides information on a company's past performance to external parties. f. Managerial accounting systems are not restricted by GAAP (or International Financial Reporting Standards, IFRS, in the case of companies headquartered in many countries outside of the United States) but are chosen by comparing the costs versus the benefits of the system. g. Choosing goals and the means to achieve them is the planning function of management. h. Managerial accounting systems report on various segments or business units of the company. i. Financial accounting statements of public companies are audited annually by CPAs.

According to the​ IMA's Statement of Ethical Professional Practice​, management accountants should follow four​ standards: competence,​ confidentiality, integrity, and credibility. Each of these standards contains specific responsibilities. Classify each of the following responsibilities according to the standard it addresses.

· Communicate information fairly and objectively. o Credibility · Communicate professional limitations that would preclude responsible judgment or successful performance of an activity. o Credibility · Mitigate actual conflicts of interest. Regularly communicate with business associates to avoid apparent conflicts of interest. Advise all parties of any potential conflicts. o Integrity · Provide decision support information and recommendations that are accurate, clear, concise and timely. Recognize and help manage risk. o Competence · Abstain from engaging in or supporting any activity that might discredit the profession. o Integrity · Provide all relevant information that could reasonably be expected to influence an · intended user's understanding of the reports, analyses, or recommendations. o Credibility · Inform all relevant parties regarding the appropriate use of confidential information. Monitor to ensure compliance. o Confidentiality · Perform professional duties in accordance with relevant laws, regulations, and technical standards. o Competence · Refrain from engaging in any conduct that would prejudice carrying out duties ethically. o Integrity · Keep information confidential except when disclosure is authorized or legally required. o Confidentiality · Report any delays or deficiencies in information, timeliness, processing, or internal controls in conformance with organization policy and/or applicable law. o Credibility · Refrain from using confidential information for unethical or illegal advantage. o Confidentiality · Maintain an appropriate level of professional leadership expertise by enhancing knowledge and skills. o Competence

Sustainability involves more than just the impact of actions on the environment. The triple bottom line recognizes that a company has to measure its impact on its triple bottom line for its​ long-term viability. Following are examples of green initiatives recently undertaken at SnackDrinkCo. For each​ example, indicate whether this initiative would primarily impact​ environmental, social, or economic factors.

. Increased the number of countries where reduced-, low-, or no-calorie products represent more than 25% of the local product lineup. Social b. For the 20th consecutive year, improved overall water efficiency in manufacturing. Environmental c. Achieved a 21% improvement in energy efficiency as compared to 10 years ago. Environmental d. Generated a profit for SnackDrinkCo's shareholders. Economic e. Worked with partners to recover and recycle the equivalent of 70% of bottles and cans used for finished beverages. Environmental f. Exceeded last year's goal of 89% of direct suppliers' compliance with SnackDrinkCo's Supplier Guiding Principles (for human and workplace rights). Social g. Last year, SnackDrinkCo reduced the weight of its products sold by 15% in the last 10 years. Environmental h. By the end of last year, 95% of SnackDrinkCo-owned facilities had achieved compliance with its Human Rights Policy. Social i. Replaced a significant portion of the plastic used in its bottles with a plant-based material. Environmental j. As of the end of last year, 50% of SnackDrinkCo's U.S. workforce was multicultural. Social k. Generated a positive economic benefit in every community in which SnackDrinkCo has facilities in the United States. Economic l. By the end of last year, almost 85% of SnackDrinkCo's plants had achieved both the ISO 9001 Quality Management standard and the FSSC 22000 Food Safety Management System standard. Social m. Reduced emissions from manufacturing in developed countries by 15% in the past 20 years. Environmental n. Lost-time incident (accident) rate fell from 3.1 incidents per 200,000 hours worked last year to 1.3 incidents per 200,000 hours worked five years ago. Social

For each of the following users of financial accounting information and managerial accounting​ information, specify whether the user would primarily use financial accounting information or managerial accounting​ information, or both.

1. Internal auditor Both financial and managerial accounting information 2. Potential shareholders Financial accounting information 3. Loan officer at the company's bank Financial accounting information 4. Manager of the Sales Department Managerial accounting information 5. Bookkeeping Department Financial accounting information 6. Managers at regional offices Managerial accounting information 7. IRS agent Financial accounting information 8. Current shareholders Financial accounting information 9. Wall Street analyst Financial accounting information 10. News reporter Financial accounting information 11. Company controller Both financial and managerial accounting information 12. Board of directors Both financial and managerial accounting information 13. SEC employee Financial accounting information 14. External auditor (public accounting firm) Financial accounting information

Faced with rising pressure for a $ 15 per hour minimum wage​ rate, the farming industry is currently exploring the possible use of robotics to replace some farm workers. The Lettuce Bot is one such​ robot; its job is to thin out a field of​ lettuce, removing the least promising buds of lettuce. By removing these weaker​ plants, the stronger lettuce plants have more room to grow. Assume the following​ facts: While the Lettuce Bot itself may be in workable condition for up to five​ years, assume that the farm would view its implementation as a​ one-year experiment. Requirement Perform a​ cost-benefit analysis for the first year of implementation to determine whether the Lettuce Bot would be a financially viable investment if the minimum wage is raised to $ 15 per hour. ​(Round your answers to the nearest whole​ dollar.)

Expected Benefits (Cost Savings) : Wages $18,750 (Calculated by multiplying: 15 dollars per hour * 25 workers that Lettuce Bot will replace * 50 hours a human worker works on average) Payroll taxes : $1,434 (Calculated by multiplying the wage amount 18750 * the percentage of payroll taxes 0.0765 [7.65%] to get 1434.375 rounded to the nearest dollar is 1434 Total expected benefits is 20184 (Calculated by adding the wages and the payroll taxes: 18750 + 1434) Expected Costs: Machine cost $ 9,500 Delivery cost 1,000 Annual Operating costs 2,500 Total Expected Costs is 13,000 (Calculated by adding the machine cost, delivery cost and annual operating costs together) Net expected benefit (cost) = 7184 (Calculated by subtracting 20.184 - 13,000)

Sustainability involves more than just the impact of actions on the environment. The triple bottom line recognizes that a company has to measure its impact on its triple bottom line for its​ long-term viability. To follow are examples of green initiatives recently undertaken at​ SodaPopCo., Inc. For each​ example, indicate whether this initiative would primarily impact​ environmental, social, or economic factors.

a. Last year, SodaPopCo increased its dividend to shareholders. ---- Economic b. It created a new global ingredient standard last year that helps to ensure ingredient safety and integrity. ---- Social c. Over the past five years, SodaPopCo used 30% less water (considered to be a scarce resource) per unit of production than in the prior five-year period. ---- Environmental d. Almost 60% of beverage launches were considered healthy option beverages last year as compared to 75% in the prior year. ---- Social e. Over the past ten years, SodaPopCo held its greenhouse gas emissions stable despite increasing production. ---Environmental f. SodaPopCo strengthened its Responsible Advertising to Children policy. Social g. The return on SodaPopCo's invested capital was above 15% for the fifth year in a row. Economic h. Last year, SodaPopCo increased its amount of recycled content in its packaging by 20%. Environmental i. Last year, 95% of SodaPopCo's waste was not sent to landfills. Environmental j. Last year, approximately 30% of SodaPopCo's net revenue came from its nutrition business since it has been making a concerted effort to promote more healthy food and beverage choices. Social k. Last year, 90% of SodaPopCo's manufacturing sites underwent an independent food safety audit by the American Institute of Baking. Social l. For the past twenty years, SodaPopCo has reached more than 2 million children in 400 schools in India through its programs promoting nutrition and physical activity. Social m. SodaPopCo provided access to safe water for 8 million people. Social n. Thirty of SodaPopCo's buildings have achieved LEED certification (LEED certification is a measure of energy efficiency). Environmental