Managerial Accounting
Chapter # 01
Homework 1

01) How does managerial accounting differ from financial accounting?
A: Managerial accounting is concerned with providing information to managers for use inside the organization. Financial accounting is con¬cerned with providing information to stockhold¬ers, creditors, and others outside of the organi¬zation.

02) Pick any major television network and describe some planning and control activities that its managers would engage in.
A: Five examples of planning activities include:
1. Estimating the advertising revenues for a future period.
2. Estimating the total expenses for a future period, including the salaries fo all actors, news reporters and sportscasters.
3. Planning how
One risk that NIKE faces is that its suppliers will fail to manage their employees in a socially responsible manner.
NIKE faces the risk that unsatisfactory environmental performance will diminish its brand image. The company is investing substantial resources to develop products that minimize adverse impacts on the environment.
NIKE faces the risk that customers will not like its new products. The company uses focus groups research to proactively assess the customers’ reaction to its new products.

10) Provide three examples of how a company’s risks can influence its planning, controlling and decision-making activities.
A: Airlines face the risk that large spikes in fuel prices will lower their profitability. They may reduce this risk by spending money on hedging contracts that enable them to lock-in future fuel prices that will not change even if the market prices increases.

11) Pick any large company and explain a three ways that it could segment its companywide performance.
A: Procter&Gamble could segment its performance by product category (Beauty and grooming, Household care, Health and well-being), product line ( crest and tide), and stock keeping units ( Crest cavity protection toothpaste, crest extra whitening toothpaste and crest sensitivity toothpaste).

12) Locate the website of any company that publishes a corporate social responsibility report (also referred to as a sustainability report). Describe three