Question 1

___________________ are incurred to prevent poor quality in the products and services being produced.

Accepted Answer

The answer of ___________________ are incurred to prevent poor quality...

Question 2

Activity attributes are financial and nonfinancial information items that describe individual activities.

Accepted Answer

A) True 
 B)False

Question 3

Match each item with the correct statement below.
-Financial and nonfinancial information items that describe individual activities.

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 4

Costs incurred when products and services prior to being delivered do not conform to specifications or customer needs are

Accepted Answer

A)  prevention costs. 
B)  appraisal costs. 
C)  a different category of quality-related costs. 
D)  external failure costs. 
E)  internal failure costs. 
A)  prevention costs. 
B)  appraisal costs. 
C)  a different category of quality-related costs. 
D)  external failure costs. 
E)  internal failure costs.

Question 5

Tires Unlimited Corp. produces two types of tires, regular and snow tires. The company uses activity-based costing and has identified two activities and their budgeted costs:
   Molding is based on mixing hours and assembly is based on machine hours. Information regarding each product is as follows:
   Required:
A. Calculate the activity rate for molding and assembly. Round your answer to two decimal places.
B. Calculate how much total overhead is assigned to each type of tire.
C. Calculate the unit overhead assigned to each type of tire.
D. Assume the company does not use ABC costing. Calculate the plantwide overhead rate, based on machine hours. Round your answer to two decimal places.
E. Calculate the total overhead assigned to each type of tire using the plantwide overhead rate.

Accepted Answer

A.
 @#IMG-DLM& B.
 @#IMG-DLM&

Question 6

Which of the following is not an example of a nonvalue-added activity?

Accepted Answer

A)  inspecting 
B)  scheduling 
C)  moving 
D)  waiting 
E)  supervising 
A)  inspecting 
B)  scheduling 
C)  moving 
D)  waiting 
E)  supervising

Question 7

Figure 7-7.Armstrong Company produces a variety of bicycles. One of its plants produces two bicycles: a mountain model and a racing model. At the beginning of the year, the following data were prepared for this plant:
   In addition, the following information was provided so that overhead costs could be assigned to each product:
  
-Refer to Figure 7-7. Armstrong Company uses activity-based costing to calculate product costs.

Accepted Answer

The answer of Figure 7-7.Armstrong Company produces a variety of...

Question 8

A volume-based costing system emphasizes direct tracing and driver tracing.

Accepted Answer

A) True 
 B)False

Question 9

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 Beaker's consumption ratio for setup hours.

Accepted Answer

A)  0.50 
B)  0.45 
C)  0.90 
D)  0.25 
E)  0.75 
A)  0.50 
B)  0.45 
C)  0.90 
D)  0.25 
E)  0.75

Question 10

Environmental costs which the firm is not financially responsible are called ____ costs.

Accepted Answer

A)  prevention 
B)  detection 
C)  external 
D)  appraisal 
E)  societal 
A)  prevention 
B)  detection 
C)  external 
D)  appraisal 
E)  societal

Question 11

Figure 7-2.Steller Manufacturing has two classes of distributors: JIT distributors and non-JIT distributors. The JIT distributor places small, frequent orders and the non-JIT distributor tends to place larger, less frequent orders. Both types of distributors purchase the same product. The customer activities and costs for the previous quarter are found below:
  
-Refer to Figure 7-2. Calculate the activity rate for processing sales orders.

Accepted Answer

A)  $330.09 per order 
B)  $525 per order 
C)  $275.76 per order 
D)  $352.94 per order 
E)  $342.43 per order 
A)  $330.09 per order 
B)  $525 per order 
C)  $275.76 per order 
D)  $352.94 per order 
E)  $342.43 per order

Question 12

Increases the efficiency of necessary activities by using economies of scale.

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 13

Companies will incur costs to perform such tasks as recycling products, controlling pollution, reducing contaminates. All of these tasks are examples of _____________________ costs.

Accepted Answer

environmen

Question 14

A product currently requires 5 moves. By changing the plant layout, the number of moves can be reduced to 1. The cost per move is $30. Calculate the reduction in nonvalue-added cost of the moving activity.

Accepted Answer

A)  $7.50 
B)  $30 
C)  $0 
D)  $120 
E)  $150 
A)  $7.50 
B)  $30 
C)  $0 
D)  $120 
E)  $150

Question 15

One of the three major dimensions of measuring activity performance is quality.

Accepted Answer

A) True 
 B)False

Question 16

Product diversity means that products consume overhead activities in systematically different proportions.

Accepted Answer

A) True 
 B)False

Question 17

A company has two inspectors, each earning a salary of $75,000. One inspector works exclusively on inspecting parts received from outside suppliers, while the other spends 30% of her time inspecting parts and 70% of her time inspecting final products. How much labor cost should be assigned to the activity, inspecting parts?

Accepted Answer

A)  $100,000 
B)  $95,000 
C)  $75,000 
D)  $96,275 
E)  $97,500 
A)  $100,000 
B)  $95,000 
C)  $75,000 
D)  $96,275 
E)  $97,500

Question 18

____ are assigned using direct tracing and resource drivers.

Accepted Answer

A)  Resources 
B)  Costs 
C)  Profits 
D)  Materials 
E)  Products 
A)  Resources 
B)  Costs 
C)  Profits 
D)  Materials 
E)  Products

Question 19

All of the following are supplier-driven activities except

Accepted Answer

A)  receiving. 
B)  purchasing. 
C)  efficiency. 
D)  inspection of incoming components. 
A)  receiving. 
B)  purchasing. 
C)  efficiency. 
D)  inspection of incoming components.

Question 20

The ___________________ is calculated by taking the amount of the activity driver per product and dividing it by total driver quantity.

Accepted Answer

The answer of The ___________________ is calculated by taking the...

___________________ are incurred to prevent poor quality in the products and services being produced.

Activity attributes are financial and nonfinancial information items that describe individual activities.

Match each item with the correct statement below. -Financial and nonfinancial information items that describe individual activities.

Costs incurred when products and services prior to being delivered do not conform to specifications or customer needs are

Which of the following is not an example of a nonvalue-added activity?

A volume-based costing system emphasizes direct tracing and driver tracing.

Environmental costs which the firm is not financially responsible are called ____ costs.

Increases the efficiency of necessary activities by using economies of scale.

Companies will incur costs to perform such tasks as recycling products, controlling pollution, reducing contaminates. All of these tasks are examples of _____________________ costs.

A product currently requires 5 moves. By changing the plant layout, the number of moves can be reduced to 1. The cost per move is $30. Calculate the reduction in nonvalue-added cost of the moving activity.

One of the three major dimensions of measuring activity performance is quality.

Product diversity means that products consume overhead activities in systematically different proportions.

____ are assigned using direct tracing and resource drivers.

All of the following are supplier-driven activities except

The ___________________ is calculated by taking the amount of the activity driver per product and dividing it by total driver quantity.

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

___________________ are incurred to prevent poor quality in the products and services being produced.

Activity attributes are financial and nonfinancial information items that describe individual activities.

Match each item with the correct statement below. -Financial and nonfinancial information items that describe individual activities.

Costs incurred when products and services prior to being delivered do not conform to specifications or customer needs are

Which of the following is not an example of a nonvalue-added activity?

A volume-based costing system emphasizes direct tracing and driver tracing.

Environmental costs which the firm is not financially responsible are called ____ costs.

Increases the efficiency of necessary activities by using economies of scale.

Companies will incur costs to perform such tasks as recycling products, controlling pollution, reducing contaminates. All of these tasks are examples of _____________________ costs.

A product currently requires 5 moves. By changing the plant layout, the number of moves can be reduced to 1. The cost per move is $30. Calculate the reduction in nonvalue-added cost of the moving activity.

One of the three major dimensions of measuring activity performance is quality.

Product diversity means that products consume overhead activities in systematically different proportions.

____ are assigned using direct tracing and resource drivers.

All of the following are supplier-driven activities except

The ___________________ is calculated by taking the amount of the activity driver per product and dividing it by total driver quantity.

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