Question 1

The throughput time for a service transaction as compared with others in the industry is known as:

Accepted Answer

A) process time. 
B) relative throughput time. 
C) degree of variation. 
D) hybrid time. 
A) process time. 
B) relative throughput time. 
C) degree of variation. 
D) hybrid time.

Question 2

Where managers use cost information about outputs to guide pricing decisions,they are likely to __________ outputs that they have under-costed,resulting in increased demand for these outputs while profit will fall.

Accepted Answer

A) underprice 
B) overprice 
C) over-cost 
D) under-cost 
A) underprice 
B) overprice 
C) over-cost 
D) under-cost

Question 3

When do managers use a job-costing?
_____________________________________________________________________________________________
_____________________________________________________________________________________________

Accepted Answer

When the c

Question 4

Schmenner classifies services according to two dimensions: degree of variation and relative throughput time.

Accepted Answer

A) True 
 B)False

Question 5

When management accountants use process-costing systems,they separate costs into cost categories according to when they are introduced into the process.

Accepted Answer

A) True 
 B)False

Question 6

Degree of variation captures the extent to which the service provider customises its services and interacts with its customers.

Accepted Answer

A) True 
 B)False

Question 7

What does over-costed output lead to?
_____________________________________________________________________________________________
_____________________________________________________________________________________________

Accepted Answer

Overpricing,causing

Question 8

Direct costs of a cost object are costs related to that cost object that managers and management accountants can trace to it in an economically feasible (cost-effective)way.

Accepted Answer

A) True 
 B)False

Question 9

The shorter the period used to calculate the cost-driver rate,the ______________ the influence of seasonal patterns and of non-seasonal,sporadic costs on the dollar-amount of the cost pool (the numerator).

Accepted Answer

A) greater 
B) lesser 
C) more irrelevant is 
D) less irrelevant is 
A) greater 
B) lesser 
C) more irrelevant is 
D) less irrelevant is

Question 10

A local engineering firm is bidding on a design project for a new client.The total budgeted direct-labour costs for the firm are $800 000.The total budgeted indirect costs are $1 200 000.It is estimated that there are 16 000 billable hours in total.
Required:
a.What is the budgeted direct-labour cost rate?
b.What is the budgeted indirect-cost rate assuming direct-labour cost is the allocation base?
c.If the firm has a 20% mark-up percentage,what should it bid on the project if the direct labour hours are estimated at 500 hours?
_____________________________________________________________________________________________
_____________________________________________________________________________________________

Accepted Answer

a.$800 000/16 000 = $50/hour
b

Question 11

Actual costing is a costing system that traces budgeted direct costs to the cost object and allocates indirect costs based on the actual cost-driver rate.

Accepted Answer

A) True 
 B)False

Question 12

Schmenner classifies services into four categories-professional service,service shop,mass service and service factory.

Accepted Answer

A) True 
 B)False

Question 13

The actual cost-driver rate measures _____________ capacity utilisation.

Accepted Answer

A) budgeted 
B) actual 
C) estimated 
D) past 
A) budgeted 
B) actual 
C) estimated 
D) past

Question 14

To motivate people to make decisions and to take actions that are congruent with the goals of the organisation,senior managers often include costs from more than one,but not necessarily all,business functions to emphasise that costs in some functions potentially affect costs in other functions.

Accepted Answer

A) True 
 B)False

Question 15

What type of costs is related to the cost object that managers and management accountants cannot trace to it in an economically feasible way?

Accepted Answer

A) Indirect 
B) Estimated 
C) Direct 
D) Actual 
A) Indirect 
B) Estimated 
C) Direct 
D) Actual

Question 16

Variation time as the measure of the time that a molecule in a production process takes 'from when the molecule is ready to have value added to it until it is a part of the finished product'.

Accepted Answer

A) True 
 B)False

Question 17

Output-cost cross-subsidisation means that if management under-costs one of its outputs,then it will over-cost at least one of its other outputs.

Accepted Answer

A) True 
 B)False

Question 18

What is the amount of productive capacity available over and above that used to meet consumer demand in the current period called?

Accepted Answer

A) Bonus time 
B) Idle time 
C) Waste 
D) Budgetary slack 
A) Bonus time 
B) Idle time 
C) Waste 
D) Budgetary slack

Question 19

A hybrid costing system blends characteristics of both job-costing and process costing systems.

Accepted Answer

A) True 
 B)False

Question 20

What is normal costing?
_____________________________________________________________________________________________
_____________________________________________________________________________________________

Accepted Answer

Normal costing is a costing sy

The throughput time for a service transaction as compared with others in the industry is known as:

Where managers use cost information about outputs to guide pricing decisions,they are likely to __________ outputs that they have under-costed,resulting in increased demand for these outputs while profit will fall.

When do managers use a job-costing? _ _

Schmenner classifies services according to two dimensions: degree of variation and relative throughput time.

When management accountants use process-costing systems,they separate costs into cost categories according to when they are introduced into the process.

Degree of variation captures the extent to which the service provider customises its services and interacts with its customers.

What does over-costed output lead to? _ _

Direct costs of a cost object are costs related to that cost object that managers and management accountants can trace to it in an economically feasible (cost-effective)way.

The shorter the period used to calculate the cost-driver rate,the ______________ the influence of seasonal patterns and of non-seasonal,sporadic costs on the dollar-amount of the cost pool (the numerator).

Actual costing is a costing system that traces budgeted direct costs to the cost object and allocates indirect costs based on the actual cost-driver rate.

Schmenner classifies services into four categories-professional service,service shop,mass service and service factory.

The actual cost-driver rate measures _____________ capacity utilisation.

To motivate people to make decisions and to take actions that are congruent with the goals of the organisation,senior managers often include costs from more than one,but not necessarily all,business functions to emphasise that costs in some functions potentially affect costs in other functions.

What type of costs is related to the cost object that managers and management accountants cannot trace to it in an economically feasible way?

Variation time as the measure of the time that a molecule in a production process takes 'from when the molecule is ready to have value added to it until it is a part of the finished product'.

Output-cost cross-subsidisation means that if management under-costs one of its outputs,then it will over-cost at least one of its other outputs.

What is the amount of productive capacity available over and above that used to meet consumer demand in the current period called?

A hybrid costing system blends characteristics of both job-costing and process costing systems.

What is normal costing? _ _

Management Accounting in Context

Different Costs for Different Purposes

Determining How Costs Behave

Costvolumeprofit Analysis

Estimating the Costs of Products and Inventory

Target Costing, Managing Activities and Managing Capacity

Activity-Based Management and Activity-Based Costing

Pricing and Customer Profitability

Decision Making and Relevant Information

Budgeting, Management Control and Responsibility Accounting

Flexible Budgets, Direct Cost Variances and Management Control

Flexible Budgets, Overhead Cost Variances and Management Control

Allocation of Support-Department Costs, Common Costs and Revenues

Strategy Formation, Strategic Control and the Balanced Scorecard

Quality, Time and the Balanced Scorecard

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

Measuring and Reporting Sustainability

Filters

Exam 5: Estimating the Cost of Producing Services

The throughput time for a service transaction as compared with others in the industry is known as:

Where managers use cost information about outputs to guide pricing decisions,they are likely to __________ outputs that they have under-costed,resulting in increased demand for these outputs while profit will fall.

When do managers use a job-costing? _____________________________________________________________________________________________ _____________________________________________________________________________________________

Schmenner classifies services according to two dimensions: degree of variation and relative throughput time.

When management accountants use process-costing systems,they separate costs into cost categories according to when they are introduced into the process.

Degree of variation captures the extent to which the service provider customises its services and interacts with its customers.

What does over-costed output lead to? _____________________________________________________________________________________________ _____________________________________________________________________________________________

Direct costs of a cost object are costs related to that cost object that managers and management accountants can trace to it in an economically feasible (cost-effective)way.

The shorter the period used to calculate the cost-driver rate,the ______________ the influence of seasonal patterns and of non-seasonal,sporadic costs on the dollar-amount of the cost pool (the numerator).

Actual costing is a costing system that traces budgeted direct costs to the cost object and allocates indirect costs based on the actual cost-driver rate.

Schmenner classifies services into four categories-professional service,service shop,mass service and service factory.

The actual cost-driver rate measures _____________ capacity utilisation.

To motivate people to make decisions and to take actions that are congruent with the goals of the organisation,senior managers often include costs from more than one,but not necessarily all,business functions to emphasise that costs in some functions potentially affect costs in other functions.

What type of costs is related to the cost object that managers and management accountants cannot trace to it in an economically feasible way?

Variation time as the measure of the time that a molecule in a production process takes 'from when the molecule is ready to have value added to it until it is a part of the finished product'.

Output-cost cross-subsidisation means that if management under-costs one of its outputs,then it will over-cost at least one of its other outputs.

What is the amount of productive capacity available over and above that used to meet consumer demand in the current period called?

A hybrid costing system blends characteristics of both job-costing and process costing systems.

What is normal costing? _____________________________________________________________________________________________ _____________________________________________________________________________________________

Management Accounting in Context

Different Costs for Different Purposes

Determining How Costs Behave

Costvolumeprofit Analysis

Estimating the Costs of Products and Inventory

Target Costing, Managing Activities and Managing Capacity

Activity-Based Management and Activity-Based Costing

Pricing and Customer Profitability

Decision Making and Relevant Information

Budgeting, Management Control and Responsibility Accounting

Flexible Budgets, Direct Cost Variances and Management Control

Flexible Budgets, Overhead Cost Variances and Management Control

Allocation of Support-Department Costs, Common Costs and Revenues

Strategy Formation, Strategic Control and the Balanced Scorecard

Quality, Time and the Balanced Scorecard

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

Measuring and Reporting Sustainability

Filters

When do managers use a job-costing? _ _

What does over-costed output lead to? _ _

What is normal costing? _ _