Exam 4: Cost Management Systems and Activity-Based Costing

When assigning indirect costs to a cost object,an ideal cost-allocation base measures ________.

Value-added costs are not necessary for most products.

In a merchandising firm,the computation of Cost of Goods Sold does NOT use ________.

Examples using activity-based costing generally show that traditional costing systems ________ high-volume,simple products and ________ low-volume,complex products.

Determining the relationships among cost objects,activities,and resources is the second step in the design of an ABC system.

Swanson Company has identified the following activities related to indirect production costs: Activity Activity Costs Cost Drivers Machine Setup \ 180,000 1,500 setup hours Materials Handling \ 50,000 12,500 pounds of materials Electric Power \ 20,000 20,000 kilowatt hours Swanson Company has obtained the following data concerning two products: Product 1 Product 2 Number of units produced 4,000 20,000 Direct materials cost \ 20,000 \ 25,000 Direct labor cost \ 12,000 \ 20,000 Number of setup hours 100 120 Pounds of materials used 500 1,500 Kilowatt-hours 1,000 2,000 Using activity-based costing,what amount of machine setup cost is assigned to Products 1 and 2? Product 1 Product 2 A) \ 12,000 \ 14,400 B) \ 30,000 \ 150,000 C) \ 50,000 \ 130,000 D) \ 81,818 \ 98,182

Today,in most manufacturing companies,workers oversee automated production processes that produce many different products.With respect to the products manufactured,the labor costs are considered to be ________.

All of the following can be sources of benchmarks EXCEPT for ________.

To determine the cost of serving a specific type of customer,such as the retail customer,which of the following are followed?

Which of the following is an example of a strategic management decision that uses cost information?

Goods undergoing the production process but not fully complete are called ________.

Period costs include selling and administrative expenses.

An example of a strategic management decision is the establishment of a pricing policy for a new product.

The computation for Cost of Goods Manufactured on the income statement is ________.(Assume there are no Work-In-Process Inventories.)

In designing an activity-based cost accounting system,what is the first step?

Donahoo Manufacturing Company had the following information available for the year: Direct materials used \ 44,000 Direct labor costs incurred \ 7,700 Indirect labor costs incurred \ 3,030 Depreciation Expense on factory building \ 19,000 Depreciation Expense on factory machines \ 100,000 Insurance Expense on factory building \ 1,200 Depreciation Expense on office equipment \ 12,000 Insurance expense on corporate office \ 1,300 Supplies Expense for factory \ 5,000 Utilities Expense for factory \ 2,000 Wages Expense for factory janitors \ 5,000 Lease Expense for factory computers \ 10,000 Finished Goods Inventory, end of year \ 32,000 Finished Goods Inventory, beginning of year \ 12,000 Work-In-Process Inventories and Raw Materials Inventories were negligible at the beginning and end of the year. Required: A) Compute the Cost of Goods Manufactured for the year. B) Compute the Cost of Goods Sold for the year.

An allocated cost is a(n)________ assigned to a cost object using a ________.

The cost object is an upholstered chair made by craftsmen in a factory.An accountant can identify the amount and cost of fabric used to manufacture the chair.This is called ________ a ________ to a cost object.

In a manufacturing company,unsold,fully complete products are called Work-In-Process Inventory.

Which of the following is an example of using cost information for operational control?