Horngren’s Financial & Managerial Accounting, The Managerial Chapters, Global Edition 7th Edition

Book Preface

What’s New to the Edition
UPDATED! End of Chapter exercises and problems have been updated with new years and company financial information.
UPDATED! Chapter openers and Tying It All Together features have been updated with current company financial information.
NEW FEATURE ON DATA ANALYTICS! Data Analytics is becoming critically important in business—specifically in
accounting. A new feature called Data Analytics in Accounting has been integrated throughout the narrative. In an increasingly
competitive environment, having the ability to harness information to make sound business decisions is becoming crucial.
Throughout the chapters, this feature highlights how real companies use Data Analytics to track inventory, monitor cash flow,
forecast sales, and maximize profits. This feature also discusses emerging technologies, such as robotic process automation
and artificial intelligence, and how they relate to businesses.
NEW DATA ANALYTICS PROJECTS! Each project contains a list of requirements, a dataset, a tutorial video, and instructions
for using software such as Excel, Power BI, or Tableau to offer students hands-on practice in analyzing and reporting data.
Using these tools, students learn how to extract and examine key information about a company related to its products,
operations, and consumer buying habits. With this experience and knowledge, students are able to make smarter business
decisions and are better prepared for the workforce.

NEW COVERAGE ON EMPLOYABILITY! The first courses in accounting are a great place to discuss the importance of
accounting credentials in today’s job market. Throughout the narrative, we highlight the role of accounting in businesses
including the most relevant accounting credentials, as well as some new ones for students beginning their study of accounting.
When discussing accounting in the business environment, in addition to the traditional career path (CPA), we also provide
information about additional certifications available to accounting majors including Certified Management Accounting (CMA),
Chartered Global Management Accountant (CGMA), and Certified Financial Planner (CFP).
Chapter 1: Introduction to Managerial Accounting
• Added discussion on professional certifications for management accountants – Certified Management Accountant (CMA)
and Chartered Global Management Accountant (CGMA).
• Added discussion on advances in technology, including data analytics, robotic process automation, and artificial intelligence,
and how they relate to the work management accountants perform.
• Updated information on the IMA Statement of Ethical Professional Practices (Exhibit M:1-4) to reflect changes made
by IMA on July 1, 2017.
• Corrected formula for calculating Cost per Service.
Chapter 2: Job Order Costing
• Added new learning objective for calculating COGM and COGS for easier teaching, learning, and assessing activities.
• Added new exhibit illustrating difference between job order costing and process costing.
• Added Data Analytics in Accounting feature on tracking and reducing environmental incidents.
Chapter 3: Process Costing
• Updated Exhibit M:3-1, process costing vs. job order costing.
Chapter 4: Lean Management Systems: Activity-Based, Just-in-Time,
and Quality Management Systems
• Changed name of chapter to emphasize lean management; concept interspersed throughout chapter.
• Added Exhibit M:4-1 to illustrate product costs for Smart Touch Learning — direct costs assigned to products, indirect costs
allocated.

• Updated calculations for predetermined manufacturing overhead rates so that more complex methods show the premium
model cost more than expected and standard model cost less than expected.
• Added Data Analytics in Accounting feature on quality management software to improve products and customers’
experiences.
Chapter 5: Cost-Volume-Profit Analysis
• Added more visuals to help students understand concepts.
• Added Data Analytics in Accounting feature on sales trends.
Chapter 7: Master Budgets
• Changed Tying It All Together feature to discuss how companies are using zero-based budgeting.
• Added Data Analytics in Accounting feature on using data and technology to build profits.
Chapter 8: Flexible Budgets and Standard Cost Systems
• Updated direct materials calculations for direct materials cost variance and direct materials efficiency variance so that inputs do
not equal outputs (previously 1 pound of wax per 1 batch of crayons; changed to 5 pounds of wax per 1 batch of crayons).

Brief Contents

Chapter 1 Introduction to Managerial Accounting 19
Chapter 2 Job Order Costing 67
Chapter 3 Process Costing 123
Chapter 4 Lean Management Systems: Activity-Based, Just-in-Time, and Quality Management Systems 191
Chapter 5 Cost-Volume-Profit Analysis 251
Chapter 6 Variable Costing 307
Chapter 7 Master Budgets 349
Chapter 8 Flexible Budgets and Standard Cost Systems 431
Chapter 9 Responsibility Accounting and Performance Evaluation 491
Chapter 10 Short-Term Business Decisions 541
Chapter 11 Capital Investment Decisions 593
APPENDIX A—Present Value Tables and Future Value Tables 649
APPENDIX B—The Statement of Cash Flows 653
APPENDIX C—Financial Statement Analysis 721
GLOSSARY 779
INDEX 785
PHOTO CREDITS 797