The following situations describe decision scenarios that could use managerial a

Question

The following situations describe decision scenarios that could use managerial accounting information: 1. The manager of Burger Barn wishes to determine the price to charge for various lunch plates. 2. By evaluating the cost of leftover materials, the plant manager of a precision machining facility wishes to determine how effectively the plant is being run. 3. The division controller needs to determine the cost of products left in inventory. 4. The manager of the Maintenance Department wishes to plan next year's anticipated expenditures. For each situation, discuss how managerial accounting information could be used

Explanation / Answer

1. Managerial Accounting information in this case can help manager of Burger Barn with the necessary information as to the total costs associated with the lunch plates. Hence the manager can add a margin to determine the price to be charged.

2. In this case the managerial accounting information in form of cost sheet on material can help the plant manager to Guage the efficiency of plant being run and take corrective action where necessary.

3. Managerial Accounting information on valuation of closing stock can help the division controller to ascertain cost of products left in inventory.

4. The Master Budget and capital budgeting can help manager of Maintainence department to plan next year's anticipated Expenditures.

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