Question 1

To calculate an activity rate, the ____ of each activity must be determined.

Accepted Answer

A)  practical capacity 
B)  expenditure level 
C)  processing ratio 
D)  value 
A)  practical capacity 
B)  expenditure level 
C)  processing ratio 
D)  value

Question 2

Match each item with the correct statement below.
-Activities that are performed each time a unit is produced.

Accepted Answer

A) activity drivers 
B) activity-based costing system 
C) consumption ratio 
D) unit-level activities 
E) activity attributes
F)resource drivers 
A) activity drivers 
B) activity-based costing system 
C) consumption ratio 
D) unit-level activities 
E) activity attributes
F)resource drivers

Question 3

Develop a set of at least five interview questions that could be used in the construction of an activity dictionary. Also explain why you would ask each question, i.e., what information you hope to acquire and how it would apply to the activity dictionary.

Accepted Answer

Answers will vary wi

Question 4

Activity drivers should be classified as either unit-level or nonunit-level.

Accepted Answer

A) True 
 B)False

Question 5

______________ is concerned with doing the activity right the first time it is performed.

Accepted Answer

The answer of ______________ is concerned with doing the activity...

Question 6

Match each item with the correct statement below.
-Resources consumed by the activity in producing its output.

Accepted Answer

A) activity analysis 
B) value-added costs 
C) velocity 
D) activity inputs 
E) activity output measure
F)activity output 
A) activity analysis 
B) value-added costs 
C) velocity 
D) activity inputs 
E) activity output measure
F)activity output

Question 7

Figure 7-4.Honeydew Company produces two products, a high end laptop computer under the label Bunsen Laptops, and an inexpensive desktop computer under the label Beaker Computers. The two products use two overhead activities, with the following costs:
   The controller has collected the expected annual prime costs for each product, the machine hours, the setup hours, and the expected production.  
-Refer to Figure 7-4. Calculate the overhead cost per unit for Bunsen Laptops, using a plantwide rate based on direct labor costs.

Accepted Answer

A)  $9.63 per laptop 
B)  $22.45 per laptop 
C)  $5.60 per laptop 
D)  $7.22 per laptop 
E)  $7.50 per laptop 
A)  $9.63 per laptop 
B)  $22.45 per laptop 
C)  $5.60 per laptop 
D)  $7.22 per laptop 
E)  $7.50 per laptop

Question 8

Randy Company produces candy sticks (hooked and straight). Both products pass through two producing departments. The hooked sticks's production is much more labor-intensive than the straight sticks. The straight stick is also more popular. The following data have been gathered for the two products:
  Randy has decided to use activity-based costing and has developed two types of activities, machine related (based on machine hours), and other overhead (based on packing orders). Machine-related costs equal $160,000. Other overhead costs equal $240,000.

Accepted Answer

The answer of Randy Company produces candy sticks (hooked and...

Question 9

Environmental costs are costs that are incurred because poor environmental quality may or does exist.

Accepted Answer

A) True 
 B)False

Question 10

Involves choosing among different sets of activities that are caused by competing strategies.

Accepted Answer

A) cycle time 
B) direct tracing 
C) activity sharing 
D) driver tracing 
E) value-added activities
F)activity selection 
A) cycle time 
B) direct tracing 
C) activity sharing 
D) driver tracing 
E) value-added activities
F)activity selection

Question 11

In an activity dictionary, types of resources consumed is an example of a(n)

Accepted Answer

A)  activity sharing. 
B)  quality. 
C)  activity attribute. 
D)  allocation. 
A)  activity sharing. 
B)  quality. 
C)  activity attribute. 
D)  allocation.

Question 12

Receiving provides 12,000 receiving hours and costs $60,000 per year. What is the activity rate for receiving?

Accepted Answer

A)  $14 per receiving hour 
B)  $5 per receiving hour 
C)  $4 per receiving hour 
D)  $4.50 per receiving hour 
E)  cannot be determined from this information 
A)  $14 per receiving hour 
B)  $5 per receiving hour 
C)  $4 per receiving hour 
D)  $4.50 per receiving hour 
E)  cannot be determined from this information

Question 13

Accurate ___________________ allow managers to make better pricing decisions, customer-mix decisions, and other customer-related decisions that improve profitability.

Accepted Answer

The answer of Accurate ___________________ allow managers to make better...

Question 14

Using only unit-based activity drivers to assign nonunit-related overhead costs can cause

Accepted Answer

A)  product diversity. 
B)  distorted product costs. 
C)  efficiency. 
D)  activity sharing. 
E)  None of these. 
A)  product diversity. 
B)  distorted product costs. 
C)  efficiency. 
D)  activity sharing. 
E)  None of these.

Question 15

Which of the following is not one of the three conditions necessary to be classified as a discretionary activity?

Accepted Answer

A)  the activity produces a change of state 
B)  the change of state was not achievable by preceding activities 
C)  the activity enables other activities to be performed 
D)  the activity increases efficiency 
A)  the activity produces a change of state 
B)  the change of state was not achievable by preceding activities 
C)  the activity enables other activities to be performed 
D)  the activity increases efficiency

Question 16

Appraisal costs are incurred to determine whether products and services are conforming to their requirements or customer needs.

Accepted Answer

A) True 
 B)False

Question 17

Which is not defined as a category of quality-related costs?

Accepted Answer

A)  prevention 
B)  appraisal 
C)  internal failure 
D)  external failure costs 
E)  all of these are categories of quality-related costs 
A)  prevention 
B)  appraisal 
C)  internal failure 
D)  external failure costs 
E)  all of these are categories of quality-related costs

Question 18

Figure 7-1.The receiving department of Owen has three activities: unloading, counting goods, and inspecting. Unloading requires a forklift that is leased for $15,000 per year. The forklift is used only for unloading. The fuel for the forklift is $2,000 per year. Inspection requires special testing equipment that has a depreciation of $500 per year and an operating cost of $1,000 per year. Receiving has four employees who each have an average salary of $35,000 per year. The work distribution matrix for the receiving personnel is as follows:
  
-Refer to Figure 7-1. Calculate the cost of unloading.

Accepted Answer

A)  $50,500 
B)  $56,000 
C)  $52,000 
D)  $54,000 
A)  $50,500 
B)  $56,000 
C)  $52,000 
D)  $54,000

Question 19

Figure 7-1.The receiving department of Owen has three activities: unloading, counting goods, and inspecting. Unloading requires a forklift that is leased for $15,000 per year. The forklift is used only for unloading. The fuel for the forklift is $2,000 per year. Inspection requires special testing equipment that has a depreciation of $500 per year and an operating cost of $1,000 per year. Receiving has four employees who each have an average salary of $35,000 per year. The work distribution matrix for the receiving personnel is as follows:
  
-Refer to Figure 7-1. Calculate the cost for inspection.

Accepted Answer

A)  $56,000 
B)  $54,000 
C)  $50,500 
D)  $52,000 
A)  $56,000 
B)  $54,000 
C)  $50,500 
D)  $52,000

Question 20

Resource drivers are factors that measure the consumption of resources by product.

Accepted Answer

A) True 
 B)False

To calculate an activity rate, the ____ of each activity must be determined.

Match each item with the correct statement below. -Activities that are performed each time a unit is produced.

Develop a set of at least five interview questions that could be used in the construction of an activity dictionary. Also explain why you would ask each question, i.e., what information you hope to acquire and how it would apply to the activity dictionary.

Activity drivers should be classified as either unit-level or nonunit-level.

______________ is concerned with doing the activity right the first time it is performed.

Match each item with the correct statement below. -Resources consumed by the activity in producing its output.

Environmental costs are costs that are incurred because poor environmental quality may or does exist.

Involves choosing among different sets of activities that are caused by competing strategies.

In an activity dictionary, types of resources consumed is an example of a(n)

Receiving provides 12,000 receiving hours and costs $60,000 per year. What is the activity rate for receiving?

Accurate ___________________ allow managers to make better pricing decisions, customer-mix decisions, and other customer-related decisions that improve profitability.

Using only unit-based activity drivers to assign nonunit-related overhead costs can cause

Which of the following is not one of the three conditions necessary to be classified as a discretionary activity?

Appraisal costs are incurred to determine whether products and services are conforming to their requirements or customer needs.

Which is not defined as a category of quality-related costs?

Resource drivers are factors that measure the consumption of resources by product.

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Process Costing

Absorption and Variable Costing, and Inventory Management

Profit Planning

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 7: Activity-Based Costing and Management

To calculate an activity rate, the ____ of each activity must be determined.

Match each item with the correct statement below. -Activities that are performed each time a unit is produced.

Develop a set of at least five interview questions that could be used in the construction of an activity dictionary. Also explain why you would ask each question, i.e., what information you hope to acquire and how it would apply to the activity dictionary.

Activity drivers should be classified as either unit-level or nonunit-level.

______________ is concerned with doing the activity right the first time it is performed.

Match each item with the correct statement below. -Resources consumed by the activity in producing its output.

Environmental costs are costs that are incurred because poor environmental quality may or does exist.

Involves choosing among different sets of activities that are caused by competing strategies.

In an activity dictionary, types of resources consumed is an example of a(n)

Receiving provides 12,000 receiving hours and costs $60,000 per year. What is the activity rate for receiving?

Accurate ___________________ allow managers to make better pricing decisions, customer-mix decisions, and other customer-related decisions that improve profitability.

Using only unit-based activity drivers to assign nonunit-related overhead costs can cause

Which of the following is not one of the three conditions necessary to be classified as a discretionary activity?

Appraisal costs are incurred to determine whether products and services are conforming to their requirements or customer needs.

Which is not defined as a category of quality-related costs?

Resource drivers are factors that measure the consumption of resources by product.

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Process Costing

Absorption and Variable Costing, and Inventory Management

Profit Planning

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Statement of Cash Flows

Financial Statement Analysis

Filters