Exam 4: Activity-Based Costing

If the company allocates all of its overhead based on direct labor-hours using its traditional costing method, the overhead assigned to each unit of Product W8 would be closest to:

The activity rate for the Machine Setups activity cost pool under activity-based costing is closest to:

The predetermined overhead rate (i.e., activity rate)for Activity 2 under the activity-based costing system is closest to:

In activity-based costing, unit product costs computed for external financial reports include direct materials, direct labor, and manufacturing overhead costs.

The activity rate for the Production Orders activity cost pool under activity-based costing is closest to:

Herd, Inc., manufactures and sells two products: Product J5 and Product A9.Data concerning the expected production of each product and the expected total direct labor-hours (DLHs)required to produce that output appear below: The company's expected total manufacturing overhead is $848,432. If the company allocates all of its overhead based on direct labor-hours, the overhead assigned to each unit of Product A9 would be closest to:

If the company allocates all of its overhead based on direct labor-hours using its traditional costing method, the overhead assigned to each unit of Product X2 would be closest to:

Trone, Inc., manufactures and sells two products: Product R8 and Product K9.Data concerning the expected production of each product and the expected total direct labor-hours (DLHs)required to produce that output appear below: The direct labor rate is $17.60 per DLH.The direct materials cost per unit for each product is given below: The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: If the company allocates all of its overhead based on direct labor-hours using its traditional costing method, the predetermined overhead rate would be closest to:

Property taxes are an example of a cost that would be considered to be:

Which of the following statements concerning the unit product cost of Product F4 is true?

The overhead applied to each unit of Product Y0 under activity-based costing is closest to:

The total overhead applied to Product B5 under activity-based costing is closest to:

The overhead applied to each unit of Product U4 under activity-based costing is closest to:

The overhead applied to each unit of Product C5 under activity-based costing is closest to:

Activity-based costing uses a number of activity cost pools, each of which is allocated to products on the basis of direct labor-hours.

Departmental overhead rates may not correctly assign overhead costs due to:

The unit product cost of Product K8 under activity-based costing is closest to:

When designing an activity-based costing system, related activities are frequently combined to reduce the amount of detail and record-keeping cost.

Cabio Company manufactures two products, Product C and Product D.The company estimated it would incur $119,100 in manufacturing overhead costs during the current period.Overhead currently is applied to the products on the basis of direct labor-hours.Data concerning the current period's operations appear below: Required: a.Compute the predetermined overhead rate under the current method, and determine the unit product cost of each product for the current year. b.The company is considering using an activity-based costing system to compute unit product costs for external financial reports instead of its traditional system based on direct labor-hours.The activity-based costing system would use three activity cost pools.Data relating to these activities for the current period are given below: Determine the unit product cost of each product for the current period using the activity-based costing approach.

Latiker, Inc., manufactures and sells two products: Product Y9 and Product W0.Data concerning the expected production of each product and the expected total direct labor-hours (DLHs)required to produce that output appear below: The direct labor rate is $15.40 per DLH.The direct materials cost per unit for each product is given below: The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: The activity rate for the Machine Setups activity cost pool under activity-based costing is closest to: