Topic 1 : Tutorial questions 1. Janice's Kennel and Pet Spa is located in Sydney.

The company employs three pet attendants, four pet groomers and two front office staff who book appointments and keep records. The spa provides a range of services for dogs and cats including boarding, grooming, and obedience training. The grooming area includes a small retail section that carries dog and cat food, pet supplies, and toys. If the cost object is cost per day of boarding, which of the following is a direct cost? a. b. c. d. Pet food Front office staff salaries Grooming supplies Depreciation on shelving and equipment used in the grooming and retail area Fixed costs per unit Vary inversely with changes in volume Change regardless of changes in volume Will not change over the relevant range Increase with an increase in volume Indirect costs are costs that cannot be traced to a cost object in an economic manner costs that it is impossible to trace to a cost object the same as fixed costs b and c

2. a. b. c. d. 3. a. b. c. d.

4. Why do managers need to measure, monitor, and motivate performance? 5. Identify two key influences on the nature of a management accounting system and briefly explain how the nature management accounting is influenced.

HBC222:MDM

6. Types of manager decisions Suppose that each of the following is an activity conducted by Microsoft Corporation. Required: Identify whether each of the following activities (ie. a to g) is most likely part of: i. organisational strategies ii. operating plans iii. actual operations, or iv. measuring, monitoring, and motivating. For each item, explain why. A. Comparing the timeliness of development steps of a new release of

Windows with the timeline that was laid out to guide development. B. Developing a timeline for release of new Windows and Microsoft

C. D. E. F. G.

Office products over the next year. Debugging the next version of Windows. Providing technical support to customers who are having problems with Microsoft Office. Estimating cash expenditures for the next year. Comparing budgeted costs to actual costs and discussing major differences with department managers. Deciding whether to construct a new building on the Microsoft

7. Allocating support costs to units A local hospital is required to account for the total cost of patient care, including support costs. Patients are assigned all direct costs. Support costs are $240 000 per month plus $90 per patient day. This 120-bed hospital averages 80% occupancy. Required: Calculate the average daily charge per patient for support costs, assuming 30 days in a month. 8. What is the management control system (MCS)? Why it is important to have MCS in an organisation? 9. What is strategy formulation and why it is important?
HBC222:MDM

10. Explain the difference between management control and strategic control. 11. List the causes of management control problems. 12. List the characteristics of a good management control system and explain why they are important to the effective management of an organization.
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