《Survey of accounting 2th会计学 Carl S.Warren》ch14.pptVIP

1. Lower-level managers can react more quickly to problems or changes in operations. 2. Lower-level managers are closer and more responsive to the customer’s needs. 3. The operation provides a better training ground for managers. 4. Delegation improves employee morale. 5. Top managemjent is free to devote time to strategic planning. 1. Assets and operating costs are duplicated (e.g., each division has its own administrative staff). 2. Managers may pursue their own goals, instead of company goals. Managers are held accountable for controlling costs. Managers are held accountable for costs and making decisions that impact revenues favorably. Managers are held accountable for costs and revenues and are also held accountable for the efficient use of assets. Administration $ 19,500 $ 19,700 $ 200 Plant A 467,475 470,330 2,855 Plant B 395,225 394,300 $925 $882,200 $884,330 $3,550 $925 Administration $ 19,500 $ 19,700 $ 200 Plant A 467,475 470,330 2,855 Plant B 395,225 394,300 $925 $882,200 $884,330 $3,550 $925 Administration $ 17,500 $ 17,350 $150 Department 1 109,725 111,280 $1,555 Department 2 190,500 192,600 2,100 Department 3 149,750 149,100 650 $467,475 $470,330 $3,655 $800 Administration $ 17,500 $ 17,350 $150 Department 1 109,725 111,280 $1,555 Department 2 190,500 192,600 2,100 Department 3 149,750 149,100 650 $467,475 $470,330 $3,655 $800 Factory wages $ 58,100 $ 58,000 $150 Materials 32,500 34,225 $1,725 Supervisory salaries 6,400 6,400 Power and light 5,750 5,690 650 Depreciation 4,000 4,000 Maintenance 2,000 1,990 10 Insurance, taxes 975 975 $109,725 $111,280 $1,725 $170 Revenues $6,000,000 $2,500,000 Operating expenses 2,495,000 405,000 Income from operations $3,505,000 $2,095,000 Purchasing $250,000 $150,000 Payroll accounting 204,000 51,000 Legal 25,000 225,000 Total charges $479,000 $426,000 Purchasing $250,000 $150,000 Payroll accounting 204,000 51,000 Legal 25,000 225,000 Total charges $479,000 $426,000