[ColoradoCPA]

Could please somebody explain why is the answer is “Equip. depreciation”? Thank you!!

“If a manufacturing company uses responsibility accounting, which one of the following items is least likely to appear in a performance report for a manager of an assembly line?

a Equipment depreciation.

b Materials.

c Repairs and maintenance.

d Direct labor.

FAR 81 ✓
AUD 97 ✓
BEC 75 ✓
REG 84 ✓

[Never_Give_Up1]

Woops read the question wrong. Yeah he has it below.

FAR - 81
REG - 81
AUD - 82
BEC - 81

Ethics - Done
State License Exam - Done

License - Licensed CPA in Utah

[ljrpr]

Beause its the only cost a manager cannot control.

AUD-83
FAR-4/12/14
REG-5/30/14
BEC-TBA

[ColoradoCPA]

ljrpr, Could you please expand your answer? I know it is a simple question but I am lost here. This manager is a cost center manager, who controls only cost. a,b,c,d are all costs and a part of product cost. They are all should be controlled by cost center. Please correct me my way of understanding it.

a Equipment depreciation. It is factory overhead

b Materials. – It is DM

c Repairs and maintenance. – It is factory overhead

d Direct labor. – It is DL.

Who would control equipment depreciation? Thank you!

FAR 81 ✓
AUD 97 ✓
BEC 75 ✓
REG 84 ✓

[jasonrobbins]

Don't think, just memorize…logic has no place in accounting

AUD- 97 1x
REG- 81 1x
BEC- 79 1x
FAR- 88 1x

DONE!

10/1/12 to 2/28/14

[Never_Give_Up1]

The reason it is Depreciation is that, Depreciation is controlled by the finance department, they set the depreciation rate or the parameters for it. Not the cost center manager.

The manager of an assembly line oversees the use of material, the repair & maintenance of machines, and the labor that is being used in the production.

Of those items what is least likely the production manager will be accountable for?

FAR - 81
REG - 81
AUD - 82
BEC - 81

Ethics - Done
State License Exam - Done

License - Licensed CPA in Utah

[SeattleAccountant]

Agree with @Nevergiveup. Right on.

Becker Class of Jan - Aug 2013: FARB DONE!!!!
CPA license pending 🙂

[ColoradoCPA]

Ok;) It makes sense now. Thank you so much for the explanation!

FAR 81 ✓
AUD 97 ✓
BEC 75 ✓
REG 84 ✓

[ColoradoCPA]

May I ask about a profit center manager? Let's say we need to determine what controls a profit center manager (in production). We know that he/she would control both revenue and cost? What would it be as far as detailed items?

PS I have Wiley book. There are only two small paragraphs about this subject((

FAR 81 ✓
AUD 97 ✓
BEC 75 ✓
REG 84 ✓

[Whopper Warrior]

Think about which each one represents:

Cost: Cost Drivers (such as a manufacturing plant)

profit: profit and cost (such as a retail outlet)

Investment: profit, cost, and invested assets (a company of a division)

As the general manager of a factory what do you control? (what you produce, and not much else)

As the general manager of a department store what do you control? (sales, promotions, employee cost, theft, electricity, but; did you choose the location of the store? no, so that should not be included)

As president of avionics at a defense contractor what do you control? JUST ABOUT EVERYTHING

If you have a basic understanding of which each one is, it is easier to put yourself in the managers shoes and discover what performance metrics you would be judged on.

ALL 4 parts passed summer 13
Ethics October 13
Experience (waiting)

Becker Only

[Author]

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