Managerial Accounting for Undergraduates

Theodore E. Christensen - University of Georgia - Athens, USA
L. Scott Hobson - Brigham Young University, Provo, UT, USA
James S. Wallace - The Peter F. Drucker and Masatoshi Ito Graduate School of Management, Claremont Graduate University
Jason W. Matthews - University of Georgia - Athens, USA

August 2025 | 672 pages | Cambridge Business Publishers

Formerly published by Cambridge Business Publishers, now published by Sage

Managerial Accounting for Undergraduates, Third Edition was written to introduce future business professionals to managerial accounting concepts and decision-making tools that support effective management in today’s competitive, service-oriented economy. Drawing on extensive professional and teaching experience, the text emphasizes applying accounting information to real business issues rather than simply producing technical answers.

Designed for students taking their first managerial accounting course, the book focuses on developing analytical skills and applying them in realistic decision-making contexts. A strong emphasis is placed on service and merchandising enterprises, reflecting the growing importance of service organizations in the modern economy. By integrating real-world examples, continuous service-industry applications, and structured learning support, the text helps students understand how managerial accounting information is used alongside other business data to make sound decisions.

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About the Authors

Preface

Chapter 1: Overview of Managerial Accounting

Introduction to Managerial Accounting

Types of Business Entities

Major Trends in Business and Managerial Accounting

Introducing Two New Companies

Careers in Managerial Accounting

Professional Certifications

Summary of Learning Objectives

Key Terms

Self-Study Questions

Questions

Data Analytics, Data Visualization, and Excel Activities

Extending Your Knowledge

Answers to Self-Study Questions: Your Turn! Solutions

Chapter 2: Managerial Accounting Concepts and Cost Flows

Key Objectives of a Managerial Accounting System

Inventories and Cost Categories

Product Cost Flows

Illustration of Product Cost Accumulation

Illustration of Product Cost Journal Entries

Service Industry in Focus

Comprehensive Problem

Summary of Learning Objectives

Key Terms

Self-Study Questions

Questions

Short Exercises

Data Analytics, Data Visualization, and Excel Activities

Exercise Sets A & B

Problem Sets A & B

Extending Your Knowledge

Answers to Self-Study Questions: Your Turn! Solutions

Chapter 3: Cost Accounting Systems: Job Order Costing

Cost Accounting Systems

Predetermined Overhead Rates

Job Order Costing Systems

Departmental Overhead Rates

Service Industry in Focus

Comprehensive Problem

Summary of Learning Objectives

Key Terms

Self-Study Questions

Questions

Short Exercises

Data Analytics, Data Visualization, and Excel Activities

Exercise Sets A & B

Problem Sets A & B

Extending Your Knowledge

Answers to Self-Study Questions: Your Turn! Solutions

Chapter 4: Cost Accounting Systems: Process Costing

Introduction to Process Costing

Characteristics of Process Costing

Process Costing Steps

The Product Cost Report

Journal Entries Illustrated

Service Industry in Focus

Comprehensive Problem (Including Transferred-in Costs)

Appendix 4A: Process Costing Using FIFO Method

Summary of Learning Objectives

Key Terms

Self-Study Questions

Questions

Short Exercises

Data Analytics, Data Visualization, and Excel Activities

Exercise Sets A & B

Problem Sets A & B

Extending Your Knowledge

Answers to Self-Study Questions: Your Turn! Solutions

Chapter 5: Activity-Based Costing

Understanding Indirect Costs Using Activity-Based Costing

Activity-Based Costing

Traditional Product Costing and ABC Compared

ABC Implementation Issues

ABC and Customer Profitability Analysis

Activity-Based Management

Services Industry in Focus

Summary of Learning Objectives

Key Terms

Self-Study Questions

Questions

Short Exercises

Data Analytics, Data Visualization, and Excel Activities

Exercise Sets A & B

Problem Sets A & B

Extending Your Knowledge

Answers to Self-Study Questions: Your Turn! Solutions

Chapter 6: Cost-Volume-Profit Relationships

Cost Behavior Analysis

Relevant Range

Analyzing Cost Behavior

Cost-Volume-Profit (CVP) Analysis

Planning for Profit

Service Industry in Focus

Comprehensive Problem

Summary of Learning Objectives

Key Terms

Self-Study Questions

Questions

Short Exercises

Data Analytics, Data Visualization, and Excel Activities

Exercise Sets A & B

Problem Sets A & B

Extending Your Knowledge

Answers to Self-Study Questions: Your Turn! Solutions

Chapter 7: Variable Costing: A Tool for Decision-Making

Treatment of Product Costs

Variable Costing Income Statement

Advantages and Disadvantages of Variable Costing

Services Industry in Focus

Comprehensive Problem

Summary of Learning Objectives

Key Terms

Self-Study Questions

Questions

Short Exercises

Data Analytics, Data Visualization, and Excel Activities

Exercise Sets A & B

Problem Sets A & B

Extending Your Knowledge

Answers to Self-Study Questions: Your Turn! Solutions

Chapter 8: Relevant Costs and Short-Term Decision-Making

Management and the Decision-Making Process

Relevant Costs and Differential Analysis

Illustrations of Differential Analysis

Service Industry in Focus

Summary of Learning Objectives

Key Terms

Self-Study Questions

Questions

Short Exercises

Data Analytics, Data Visualization, and Excel Activities

Exercise Sets A & B

Problem Sets A & B

Extending Your Knowledge

Answers to Self-Study Questions: Your Turn! Solutions

Chapter 9: Planning and Budgeting

The Planning Process

The Budgeting Process

The Framework of the Master Budget

Illustration of a Master Budget and Its Components

Services Industry in Focus

Comprehensive Problem

Summary of Learning Objectives

Key Terms

Self-Study Questions

Questions

Short Exercises

Data Analytics, Data Visualization, and Excel Activities

Exercise Sets A & B

Problem Sets A & B

Extending Your Knowledge

Answers to Self-Study Questions: Your Turn! Solutions

Chapter 10: Flexible Budgets, Segment Reporting, and Performance Analysis

Static Budgets

Flexible Budgets

Internal Reporting of Segment Operations

Performance Reporting

Service Company Segment Reporting Illustration

Performance Analysis

Service Industry in Focus

Appendix 10A: Transfer Pricing

Comprehensive Problem

Summary of Learning Objectives

Key Terms

Self-Study Questions

Questions

Short Exercises

Data Analytics, Data Visualization, and Excel Activities

Exercise Sets A & B

Problem Sets A & B

Extending Your Knowledge

Answers to Self-Study Questions: Your Turn! Solutions

Chapter 11: Standard Costing and Variance Analysis

Standard Costs

Determining Standard Costs

Review of Flexible Budget Cost Variance

Variable Manufacturing Cost Variances

Standard Costs in Financial Statements

Services Industry in Focus

Appendix 11A: Cost Variance Journal Entries Illustrated

Comprehensive Problem

Summary of Learning Objectives

Key Terms

Self-Study Questions

Questions

Short Exercises

Data Analytics, Data Visualization, and Excel Activities

Exercise Sets A & B

Problem Sets A & B

Extending Your Knowledge

Answers to Self-Study Questions: Your Turn! Solutions

Chapter 12: Capital Budgeting

Elements of Capital Budgeting

Required Rates of Return and the Time Value of Money

Performing Net Present Value Calculations

Measurement of Investments and Returns

Net Present Value Analysis

Other Capital Budgeting Analyses

Service Industry in Focus

Appendix 12A: Time Value of Money Calculations

Comprehensive Problem

Summary of Learning Objectives

Key Terms

Self-Study Questions

Questions

Short Exercises

Data Analytics, Data Visualization, and Excel Activities

Exercise Sets A & B

Problem Sets A & B

Extending Your Knowledge

Answers to Self-Study Questions: Your Turn! Solutions

Chapter 13: Statement of Cash Flows

Cash and Cash Equivalents

Activity Classifications in the Statement of Cash Flows

Noncash Investing and Financing Activities

Using the Statement of Cash Flows

Cash Flow from Operating Activities

Preparing the Statement of Cash Flows Using the Indirect Method

Analyzing Cash Flows

Comprehensive Problem

Appendix 13A: Preparing the Statement of Cash Flows Under the Direct Method

Summary of Learning Objectives

Key Terms

Self-Study Questions

Questions

Short Exercises

Data Analytics, Data Visualization, and Excel Activities

Exercise Sets A & B

Problem Sets A & B

Extending Your Knowledge

Answers to Self-Study Questions: Your Turn! Solutions

Chapter 14: Analysis and Interpretation of Financial Statements

Persistent Earnings and the Income Statement

Sources of Information

Horizontal Analysis

Trend Analysis

Vertical Analysis

Ratio Analysis

Limitations of Financial Statement Analysis

Comprehensive Problem

Appendix 14A: Financial Statement Disclosures

Summary of Learning Objectives

Summary of Financial Statement Ratios

Key Terms

Self-Study Questions

Questions

Short Exercises

Data Analytics, Data Visualization, and Excel Activities

Exercise Sets A & B

Problem Sets A & B

Extending Your Knowledge

Answers to Self-Study Questions: Your Turn! Solutions

Appendix A: Accounting and the Time Value of Money

Time Value of Money Concept

Future Value of an Amount

Future Value of an Annuity

Present Value of an Amount

Present Value of an Annuity

Calculations Using a Calculator and a Spreadsheet

Summary of Learning Objectives

Key Terms

Self-Study Questions

Exercise Sets A & B

Answers to Self-Study Questions: Your Turn! Solutions

Appendix B: Data Analytics

Data Analytics

Summary of Learning Objectives

Key Terms

Questions

Exercises

Problems

Index

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Key features

NEW TO THIS EDITION:

Continued emphasis on service-industry and merchandising applications of managerial accounting.

Expanded integration of real-world decision-making contexts.

Enhanced student-support features designed to improve comprehension and application.

Ongoing alignment with professional practice through CMA®-style questions.

KEY FEATURES:

Introductory Focus: Designed specifically for students taking their first managerial accounting course.

Decision-Making Emphasis: Helps students move beyond mechanical calculations to understand how accounting information supports real business decisions.

Service-Industry Orientation: Strong focus on service and merchandising enterprises reflects the structure of today’s economy.

Real Company Examples: Widely recognized companies are used throughout the text to increase relevance and engagement.
Continuous Service-Industry Application: A recurring service-firm scenario allows students to apply concepts consistently across chapters.

Environmental, Social, and Governance (ESG): ESG boxes help students understand how sustainability and social responsibility influence managerial decisions.

Service Industry in Focus: Dedicated inserts demonstrate how managerial accounting tools improve service-company competitiveness.

Accounting in Practice: Boxed features bridge classroom learning and real-world managerial decision-making.
CMA® Examination Questions: End-of-chapter CMA-style questions expose students to professional expectations and applied analysis.

Student Success Orientation: Structured learning aids help students recall, apply, and reinforce managerial accounting concepts.

Road Maps: Each chapter begins with a Road Map summarizing content, learning objectives, and available resources.

Your Turn! Practice: Each learning objective concludes with a Your Turn! activity, supported by solutions and video demonstrations in myBusinessCourse™.

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