Question 1

Discuss some of the factors that could motivate an organization to implement activity based costing.

Accepted Answer

Some of the motivational factors are: 1.

Question 2

For a company that manufactures candy,how would the costs of product inspection be classified?

Accepted Answer

A)  Yes No 
B)  No Yes 
C)  Yes Yes 
D)  No No 
A)  Yes No 
B)  No Yes 
C)  Yes Yes 
D)  No No

Question 3

When cost driver analysis is used,organizational profit or loss can be determined by subtracting

Accepted Answer

A) organizational costs from total margin provided by products. 
B) organizational costs from total product revenue. 
C) total product costs from total product revenue. 
D) total unit,batch,product/process,and organizational level costs incurred for a period from total product revenue. 
A) organizational costs from total margin provided by products. 
B) organizational costs from total product revenue. 
C) total product costs from total product revenue. 
D) total unit,batch,product/process,and organizational level costs incurred for a period from total product revenue.

Question 4

Stone Company Stone Company produces 50,000 units of Product Q and 6,000 units of Product Z during a period.In that period,four set-ups were required for color changes.All units of Product Q are black,which is the color in the process at the beginning of the period.A set-up was made for 1,000 blue units of Product Z; a set-up was made for 4,500 red units of Product Z; a set-up was made for 500 green units of Product Z.A set-up was then made to return the process to its standard black coloration and the units of Product Q were run.Each set-up costs $500.
Refer to Stone Company.Assume that Stone Company has decided to allocate overhead costs using levels of cost drivers.What would be the approximate per-unit set-up cost for the green units of Product Z?

Accepted Answer

A) $1.00. 
B) $0.25. 
C) $0.04. 
D) None of the responses are correct. 
A) $1.00. 
B) $0.25. 
C) $0.04. 
D) None of the responses are correct.

Question 5

In activity-based costing,cost reduction efforts are directed at specific

Accepted Answer

A) cost categories. 
B) cost pools. 
C) processes. 
D) cost drivers. 
A) cost categories. 
B) cost pools. 
C) processes. 
D) cost drivers.

Question 6

Activity analysis allows managers to

Accepted Answer

A) classify activities so that processes can be eliminated. 
B) devise ways to minimize or eliminate non-value-added activities. 
C) evaluate process performance to gain competitive advantages. 
D) all of the above. 
A) classify activities so that processes can be eliminated. 
B) devise ways to minimize or eliminate non-value-added activities. 
C) evaluate process performance to gain competitive advantages. 
D) all of the above.

Question 7

Ada National Bank Ada National Bank had the following activities,traceable costs,and
Physical flow of driver units:
  The above activities are used by the Broken Arrow branch and the Choctaw branch:
  Refer to Ada National Bank.How much of the new account cost will be assigned to the Choctaw branch?

Accepted Answer

A) $10,000 
B) $20,000 
C) $30,000 
D) $50,000 
A) $10,000 
B) $20,000 
C) $30,000 
D) $50,000

Question 8

Engaging in which of the following will result in radical changes being made to an organization's processes?

Accepted Answer

A) Continuous improvement 
B) Benchmarking 
C) Reengineering 
D) Mass customization 
A) Continuous improvement 
B) Benchmarking 
C) Reengineering 
D) Mass customization

Question 9

Moreno Company makes ten different styles of inexpensive feather masks.Which of the following is this company most likely to have?

Accepted Answer

A) Product complexity 
B) Process complexity 
C) Product variety 
D) Process customization 
A) Product complexity 
B) Process complexity 
C) Product variety 
D) Process customization

Question 10

Traditional overhead allocations result in which of the following situations?

Accepted Answer

A) Overhead costs are assigned as period costs to manufacturing operations. 
B) High-volume products are assigned too much overhead,and low-volume products are assigned too little overhead. 
C) Low-volume products are assigned too much,and high-volume products are assigned too little overhead. 
D) The resulting allocations cannot be used for financial reports. 
A) Overhead costs are assigned as period costs to manufacturing operations. 
B) High-volume products are assigned too much overhead,and low-volume products are assigned too little overhead. 
C) Low-volume products are assigned too much,and high-volume products are assigned too little overhead. 
D) The resulting allocations cannot be used for financial reports.

Question 11

Memory Chest Corporation manufactures hand-made pine storage boxes for a variety of clients.As production manager,you have developed the following value chart:

Accepted Answer

The answer of Memory Chest Corporation manufactures hand-made pine storage...

Question 12

For a CPA firm,how would the wages of staff auditors be classified?

Accepted Answer

A)  Yes No 
B)  No Yes 
C)  Yes Yes 
D)  No No 
A)  Yes No 
B)  No Yes 
C)  Yes Yes 
D)  No No

Question 13

A company should strive to reduce all non-value added activities to a minimum.

Accepted Answer

A) True 
 B)False

Question 14

Implementing activity based costing (ABC)has a direct impact on reducing overhead in an organization.

Accepted Answer

A) True 
 B)False

Question 15

A process map

Accepted Answer

A) should indicate only value-added activities. 
B) is also known as a detailed flowchart. 
C) should indicate only those steps/processes that are obvious in the production of goods/services. 
D) is also known as a value chart. 
A) should indicate only value-added activities. 
B) is also known as a detailed flowchart. 
C) should indicate only those steps/processes that are obvious in the production of goods/services. 
D) is also known as a value chart.

Question 16

Video Corporation Video Corporation has two product lines: LCD televisions and projection televisions.The company has budgeted the following production and overhead costs for the upcoming year:
  Refer to Video Corporation.If the company uses number of units produced to allocate factory overhead,the materials handing cost allocated to LCD TVs would be:

Accepted Answer

A) $23,077 
B) $28,125 
C) $30,000 
D) $45,000 
A) $23,077 
B) $28,125 
C) $30,000 
D) $45,000

Question 17

Adopting a just-in-time (JIT)manufacturing process may enable a company to increase manufacturing cycle efficiency (MCE).

Accepted Answer

A) True 
 B)False

Question 18

Levine Company Levine Company produces two products: A and B The company has three overhead functions that are required for both products.
Below is production information for Products A and B:
  The company produces 800 units of Product A and 8,000 units of Product B each period.
The overhead functions have the following hourly costs:
  Refer to Levine Company If total overhead is assigned to A and B on the basis of direct labor hours,Product B will have an overhead cost per unit of

Accepted Answer

A) $76.97 
B) $87.75 
C) $88.64 
D) None of the responses are correct. 
A) $76.97 
B) $87.75 
C) $88.64 
D) None of the responses are correct.

Question 19

An activity driver is used for which of the following reasons?

Accepted Answer

A) yes yes 
B) yes no 
C) no yes 
D) no no 
A) yes yes 
B) yes no 
C) no yes 
D) no no

Question 20

The first step in performing activity analysis is to prepare a process map.

Accepted Answer

A) True 
 B)False

Discuss some of the factors that could motivate an organization to implement activity based costing.

For a company that manufactures candy,how would the costs of product inspection be classified?

When cost driver analysis is used,organizational profit or loss can be determined by subtracting

In activity-based costing,cost reduction efforts are directed at specific

Activity analysis allows managers to

Ada National Bank Ada National Bank had the following activities,traceable costs,and Physical flow of driver units: The above activities are used by the Broken Arrow branch and the Choctaw branch: Refer to Ada National Bank.How much of the new account cost will be assigned to the Choctaw branch?

Engaging in which of the following will result in radical changes being made to an organization's processes?

Moreno Company makes ten different styles of inexpensive feather masks.Which of the following is this company most likely to have?

Traditional overhead allocations result in which of the following situations?

Memory Chest Corporation manufactures hand-made pine storage boxes for a variety of clients.As production manager,you have developed the following value chart:

For a CPA firm,how would the wages of staff auditors be classified?

A company should strive to reduce all non-value added activities to a minimum.

Implementing activity based costing (ABC)has a direct impact on reducing overhead in an organization.

A process map

Adopting a just-in-time (JIT)manufacturing process may enable a company to increase manufacturing cycle efficiency (MCE).

An activity driver is used for which of the following reasons?

The first step in performing activity analysis is to prepare a process map.

Introduction to Cost Accounting

Cost Terminology and Cost Behaviors

Predetermined Overhead Rates, flexible Budgets, and Absorptionvariable Costing

Job Order Costing

Process Costing

Standard Costing and Variance Analysis

The Master Budget

Break-Even Point and Cost-Volume-Profit Analysis

Relevant Information for Decision Making

Allocation of Joint Costs and Accounting for By-Products

Introduction to Cost Management Systems

Responsibility Accounting, support Department Allocations, and Transfer Pricing

Performance Measurement, balanced Scorecards, and Performance Rewards

Capital Budgeting

Managing Costs and Uncertainty

Implementing Quality Concepts

Inventory and Production Management

Emerging Management Practices

Filters

Exam 4: Activity-Based Management and Activity-Based Costing

Discuss some of the factors that could motivate an organization to implement activity based costing.

For a company that manufactures candy,how would the costs of product inspection be classified?

When cost driver analysis is used,organizational profit or loss can be determined by subtracting

In activity-based costing,cost reduction efforts are directed at specific

Activity analysis allows managers to

Ada National Bank Ada National Bank had the following activities,traceable costs,and Physical flow of driver units: The above activities are used by the Broken Arrow branch and the Choctaw branch: Refer to Ada National Bank.How much of the new account cost will be assigned to the Choctaw branch?

Engaging in which of the following will result in radical changes being made to an organization's processes?

Moreno Company makes ten different styles of inexpensive feather masks.Which of the following is this company most likely to have?

Traditional overhead allocations result in which of the following situations?

Memory Chest Corporation manufactures hand-made pine storage boxes for a variety of clients.As production manager,you have developed the following value chart:

For a CPA firm,how would the wages of staff auditors be classified?

A company should strive to reduce all non-value added activities to a minimum.

Implementing activity based costing (ABC)has a direct impact on reducing overhead in an organization.

A process map

Adopting a just-in-time (JIT)manufacturing process may enable a company to increase manufacturing cycle efficiency (MCE).

An activity driver is used for which of the following reasons?

The first step in performing activity analysis is to prepare a process map.

Introduction to Cost Accounting

Cost Terminology and Cost Behaviors

Predetermined Overhead Rates, flexible Budgets, and Absorptionvariable Costing

Job Order Costing

Process Costing

Standard Costing and Variance Analysis

The Master Budget

Break-Even Point and Cost-Volume-Profit Analysis

Relevant Information for Decision Making

Allocation of Joint Costs and Accounting for By-Products

Introduction to Cost Management Systems

Responsibility Accounting, support Department Allocations, and Transfer Pricing

Performance Measurement, balanced Scorecards, and Performance Rewards

Capital Budgeting

Managing Costs and Uncertainty

Implementing Quality Concepts

Inventory and Production Management

Emerging Management Practices

Filters