Exam 14: Cost Allocation, Customer-Profitability Analysis, and Sales-Variance Analysis

Dartmouth Building Products Inc. provides the following information. Corporate advertising costs = $860,000 Division A - $4,900,000 Division B - $19,600,000 Number of ads run on Division A products 600 Number of ads run on Division B products 4400 Assume that customers with higher revenues benefited more from corporate advertising costs than customers with lower revenues. What is the allocated corporate costs for Division B?

(Multiple Choice)

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Question 161

Using the fairness criterion, the costs are allocated among the beneficiaries in proportion to the benefits each receives.

(True/False)

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Question 162

Sales-mix variance = $300,000 (F), sales-volume variance = $470,000 (U), flexible-budget variance = $230,000 (F), market-size variance = $34,000 (U), calculate the sales-quantity variance.

(Multiple Choice)

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Question 163

An activity-based costing system may focus on customers rather than products.

(True/False)

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Question 164

A customer cost hierarchy may include distribution-channel costs.

(True/False)

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Question 165

The budgeted contribution margin per composite unit for the budgeted sales mix can be computed by dividing the ________.

(Multiple Choice)

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Question 166

Companies that want to calculate the full cost of products must allocate all corporate costs to divisions.

(True/False)

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Question 167

Showing 161 - 167 of 167

Using the fairness criterion, the costs are allocated among the beneficiaries in proportion to the benefits each receives.

Sales-mix variance = $300,000 (F), sales-volume variance = $470,000 (U), flexible-budget variance = $230,000 (F), market-size variance = $34,000 (U), calculate the sales-quantity variance.

An activity-based costing system may focus on customers rather than products.

A customer cost hierarchy may include distribution-channel costs.

The budgeted contribution margin per composite unit for the budgeted sales mix can be computed by dividing the ________.

Companies that want to calculate the full cost of products must allocate all corporate costs to divisions.

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Activity-Based Management

Master Budget and Responsibility Accounting

Flexible Budgets, Direct-Cost Variances, and Management Control

Flexible Budgets, Overhead Cost Variances, and Management Control

Inventory Costing and Capacity Analysis

Determining How Costs Behave

Decision Making and Relevant Information

Strategy, Balanced Scorecard, and Strategic Profitability Analysis

Pricing Decisions and Cost Management

Allocation of Support-Department Costs, Common Costs, and Revenues

Cost Allocation: Joint Products and Byproducts

Process Costing

Spoilage, Rework, and Scrap

Balanced Scorecard: Quality and Time

Inventory Management, Just-in-Time, and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, Transfer Pricing, and Multinational Considerations

Performance Measurement, Compensation, and Multinational Considerations

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