251TI - Horngren'S Financial And Managerial Accounting

Question

Doherty Company is considering replacing the individual printers each employee in the corporate office currently uses with a network printer located in a central area. The network printer is more efficient and would, therefore, cost less to operate than the individual printers. However, most of the office staff think having to use a centralized printer would be inconvenient. They prefer to have individual printers located at each desk. Identify the following information as financial or nonfinancial and relevant or irrelevant. The first item has been completed as an example.

	Financial	Nonfinancial	Relevant	Irrelevant
Amount paid for current printers
Resale value of current printers
Cost of new printer
Operating costs of current printers
Operating costs of new printer
Employee morale

Step-by-Step Solution

Answer

	Financial	Nonfinancial	Relevant	Irrelevant
Resale value of current printers
Cost of new printer
Operating costs of current printers
Operating cost  of new printer
Employee morale

Meaning of Employee

The term employee refers to the human asset of an organization that renders its services and skills to the organization to accomplish common goals stated by the upper management. Employees get salaries, commissions, and other benefits for their services

The meaning of Financial information

The information or data associated with the economic transactions of a business concern is termed as financial information. Such type of information is recorded in the books of accounts

The meaning of non-financial information

Non-financial information refers to the qualitative information which cannot be measured in terms of money but helps the administration to make valuable decisions associated with business operations.