Solution Manual for Managerial Accounting 11th CANADIAN Edition by Garrison
Exercise 1-1 (20 minutes)
i. Developing sales estimates of a product for use in the annual
budget for a product is a planning activity since doing so will establish
a
goal
for
sales
levels
in
the
coming
year.
ii.
The review of the monthly quality control reports is a controlling
activity aimed at determining whether production processes are
operating as planned. Identifying the team members to investigate
the problem is a directing and motivating activity since it involves
assigning tasks to specific individuals. The selection of team members
is
also
a
decision-making
activity
since
the
manager
will
need
to
determine
which
employees
are
best
suited
(e.g.,
which
ones
have
the
necessary
skills,
the
time
available,
etc.)
to
conduct
the
investigation
iii.
Choosing from the two design alternatives for the speakers is a
decision-making activity. It could also be argued that this is a
planning activity since it will affect which speaker design the company
decides
to
offer
to
its
customers
in
future
periods.
iv. Reviewing the monthly performance report is a controlling activity.
Determining the production schedule in the coming months is both
a planning and directing and motivating activity since it involves
the future scheduling of day-to-day activities related to manufacturing
the
televisions.
Evaluating
how
to
motivate
retailers
to
improve
sales
is
also
a
directing
and
motivating
activity
and
has
an
element
of
planning
as
well
assuming
changes
are
going
to
be
made
to
the
current
incentive
system.
The
evaluation
also
involves
decision-making with respect to continuing or discontinuing the
plasma television line, and planning activities such as setting
budgets for future sales of plasma televisions if the product continues
to
be
offered.