Question 1

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

Accepted Answer

A) True 
 B)False

Question 2

Match each item with the correct statement below.
-System that emphasizes direct tracing and driver tracing.

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

Match each item with the correct statement below.
-Factors that measure the consumption of resources by 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

Activity drivers can be classified as either ____ or ____.

Accepted Answer

A)  unit-level; nonunit-level 
B)  exact; inexact 
C)  inputs; outputs 
D)  right; wrong 
A)  unit-level; nonunit-level 
B)  exact; inexact 
C)  inputs; outputs 
D)  right; wrong

Question 5

Workshape 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 as follows: 
-
 Calculate the activity rate for processing sales orders.(Note: Round answer to two decimal places.)

Accepted Answer

A)  $330.09 per sales order 
B)  $525.33 per sales order 
C)  $275.76 per sales order 
D)  $301.89 per sales order 
E)  $342.43 per sales order 
A)  $330.09 per sales order 
B)  $525.33 per sales order 
C)  $275.76 per sales order 
D)  $301.89 per sales order 
E)  $342.43 per sales order

Question 6

Workshape 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 as follows: 
- Calculate the total customer cost for the JIT distributors.(Note: Round the activity rates and activity costs to the nearest dollar.)

Accepted Answer

A)  $487,560 
B)  $362,890 
C)  $612,370 
D)  $250,020 
E)  $448,730 
A)  $487,560 
B)  $362,890 
C)  $612,370 
D)  $250,020 
E)  $448,730

Question 7

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:  
- 
 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 8

Complying with the filing requirements of the IRS is an example of a

Accepted Answer

A)  recreational activity. 
B)  discretionary activity. 
C)  recommended activity. 
D)  required activity. 
A)  recreational activity. 
B)  discretionary activity. 
C)  recommended activity. 
D)  required activity.

Question 9

Match each item with the correct statement below.
-The number of times an activity is performed.

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 10

Consider the following two activities: (1) performing warranty work, cost: $60,000.The warranty cost of the most efficient competitor is $10,000.(2) Purchasing components, cost: $100,000 (5,000 purchase orders).A study reveals that the most efficient level would use 2,500 purchase orders and entail a cost of $55,000. What is the total nonvalue-added cost?

Accepted Answer

A)  $55,000 
B)  $60,000 
C)  $105,000 
D)  $100,000 
A)  $55,000 
B)  $60,000 
C)  $105,000 
D)  $100,000

Question 11

Rizzo Manufacturing produces two types of cameras: 35mm and digital.The cameras are produced using one continuous process.Four activities have been identified: machining, setups, receiving, and packing.Resource drivers have been used to assign costs to each activity.The overhead activities, their costs, and the other related data are as follows: 
 Calculate an activity rate for packing based on packing orders.

Accepted Answer

A)  $9.00 per packing order 
B)  $10.00 per packing order 
C)  $8.00 per packing order 
D)  $60.00 per packing order 
E)  $1.20 per packing order 
A)  $9.00 per packing order 
B)  $10.00 per packing order 
C)  $8.00 per packing order 
D)  $60.00 per packing order 
E)  $1.20 per packing order

Question 12

Increasing the efficiency of necessary activities by using economies of scale is known as

Accepted Answer

A)  activity inputs. 
B)  activity sharing. 
C)  control activities. 
D)  cycle time. 
A)  activity inputs. 
B)  activity sharing. 
C)  control activities. 
D)  cycle time.

Question 13

Activity-based management attempts to

Accepted Answer

A)  identify and eliminate all unnecessary activities. 
B)  increase the efficiency of necessary activities. 
C)  add new activities that increase value. 
D)  do all of these. 
A)  identify and eliminate all unnecessary activities. 
B)  increase the efficiency of necessary activities. 
C)  add new activities that increase value. 
D)  do all of these.

Question 14

Discretionary activities are necessary to comply with legal mandates.

Accepted Answer

A) True 
 B)False

Question 15

A manual process takes 20 minutes of direct labor time and 8 pounds of material to produce a product.Automating the process requires 16 minutes of machine time and 6 pounds of material.The cost per labor hour is $10, the cost per machine hour is $8, and the cost per pound of materials is $12. Find the nonvalue-added cost for the given situation.(Note: Round all calculations and the answer to two decimal places.)

Accepted Answer

A)  $22.40 per unit 
B)  $9.00 per unit 
C)  $25.20 per unit 
D)  $1.70 per unit 
A)  $22.40 per unit 
B)  $9.00 per unit 
C)  $25.20 per unit 
D)  $1.70 per unit

Question 16

Tracing ________________ costs to suppliers can enable managers to choose the true low-cost supplier.

Accepted Answer

The answer of Tracing ________________ costs to suppliers can enable...

Question 17

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 18

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 19

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...

Question 20

Match each item with the correct statement below.
-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

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

Match each item with the correct statement below. -System that emphasizes direct tracing and driver tracing.

Match each item with the correct statement below. -Factors that measure the consumption of resources by activities.

Activity drivers can be classified as either or .

Complying with the filing requirements of the IRS is an example of a

Match each item with the correct statement below. -The number of times an activity is performed.

Increasing the efficiency of necessary activities by using economies of scale is known as

Activity-based management attempts to

Discretionary activities are necessary to comply with legal mandates.

Tracing ________________ costs to suppliers can enable managers to choose the true low-cost supplier.

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

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.

Match each item with the correct statement below. -Increases the efficiency of necessary activities by using economies of scale.

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior, Cost Forecasting, and Segmented Income Statements

Job-Order Costing and Normal Cost Overhead Application

Process Costing

Cost-Volume-Profit Analysis

Tactical Decision-Making and Relevant Costing

Profit Planning and Flexible Budgets

Standard Costing and Variance Analysis

Performance Evaluation and Decentralization

Capital Investment Decisions

Emerging Topics in Managerial Accounting: Sustainability, Quality Cost, Lean Accounting, International Issues, Enterprise Risk Management, the Managerial Accountant in Forensicfraud Accounting

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 5: Activity-Based Costing and Management

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

Match each item with the correct statement below. -System that emphasizes direct tracing and driver tracing.

Match each item with the correct statement below. -Factors that measure the consumption of resources by activities.

Activity drivers can be classified as either ____ or ____.

Complying with the filing requirements of the IRS is an example of a

Match each item with the correct statement below. -The number of times an activity is performed.

Increasing the efficiency of necessary activities by using economies of scale is known as

Activity-based management attempts to

Discretionary activities are necessary to comply with legal mandates.

Tracing ________________ costs to suppliers can enable managers to choose the true low-cost supplier.

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

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.

Match each item with the correct statement below. -Increases the efficiency of necessary activities by using economies of scale.

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior, Cost Forecasting, and Segmented Income Statements

Job-Order Costing and Normal Cost Overhead Application

Process Costing

Cost-Volume-Profit Analysis

Tactical Decision-Making and Relevant Costing

Profit Planning and Flexible Budgets

Standard Costing and Variance Analysis

Performance Evaluation and Decentralization

Capital Investment Decisions

Emerging Topics in Managerial Accounting: Sustainability, Quality Cost, Lean Accounting, International Issues, Enterprise Risk Management, the Managerial Accountant in Forensicfraud Accounting

Statement of Cash Flows

Financial Statement Analysis

Filters

Activity drivers can be classified as either or .