Question 1

Froelech Company has developed capacity standards.Information is as follows:   The unused capacity variance is

Accepted Answer

A)  $20,000 favorable. 
B)  $30,000 favorable. 
C)  $50,000 favorable. 
D)  There is no variance. 
A)  $20,000 favorable. 
B)  $30,000 favorable. 
C)  $50,000 favorable. 
D)  There is no variance.

Question 2

Which of the following is descriptive of activity-based responsibility accounting?

Accepted Answer

A)  It assumes that activities can be collected into independent subgroups. 
B)  Its focus is the organization. 
C)  It assigns responsibility to processes. 
D)  Its standards are engineered and tend to be static. 
A)  It assumes that activities can be collected into independent subgroups. 
B)  Its focus is the organization. 
C)  It assigns responsibility to processes. 
D)  Its standards are engineered and tend to be static.

Question 3

Which of the following process dimensions of the activity-based management model deals with "how well"?

Accepted Answer

A)  resources 
B)  driver analysis 
C)  activities 
D)  performance measures 
A)  resources 
B)  driver analysis 
C)  activities 
D)  performance measures

Question 4

Clark, Inc., sells one of its products for $150 each.Sales volume averages 800 units per year.Recently, its main competitor reduced the price of its product to $130.Clark expects sales to drop dramatically unless it matches the competitor's price.In addition, the current profit per unit must be maintained.Information about the product (for production of 800) is as follows:
   Required:

Accepted Answer

@#IMG-DLM&_TB2043_00

Question 5

Setup time for a product is 12 hours.A firm that uses JIT and produces the same product has reduced setup time to 1 hour.Setup labor is $6 per hour.
-The non-value-added costs are

Accepted Answer

A)  $72. 
B)  $66. 
C)  $12. 
D)  $6. 
A)  $72. 
B)  $66. 
C)  $12. 
D)  $6.

Question 6

Which of the following is NOT a common step in an ABM implementation model?

Accepted Answer

A)  Systems planning 
B)  Assess Value Content of Activities 
C)  Identify, Define, and Classify Activities 
D)  All of these are common steps. 
A)  Systems planning 
B)  Assess Value Content of Activities 
C)  Identify, Define, and Classify Activities 
D)  All of these are common steps.

Question 7

A time-and-motion study revealed that it should take 2 hours to produce a product that currently takes 6 hours to produce.Labor is $8 per hour. The non-value-added costs are

Accepted Answer

A)  $16. 
B)  $32. 
C)  $48. 
D)  $-0-. 
A)  $16. 
B)  $32. 
C)  $48. 
D)  $-0-.

Question 8

_______________ are the resources consumed by the activity in producing its output.

Accepted Answer

A)  Activity inputs 
B)  Activity outputs 
C)  Driver analysis 
D)  Value-added activities 
A)  Activity inputs 
B)  Activity outputs 
C)  Driver analysis 
D)  Value-added activities

Question 9

The responsibility accounting system developed for operations in a continuous improvement environment would be

Accepted Answer

A)  financial-based responsibility accounting. 
B)  functional-based responsibility accounting. 
C)  activity-based responsibility accounting. 
D)  strategy-based responsibility accounting. 
A)  financial-based responsibility accounting. 
B)  functional-based responsibility accounting. 
C)  activity-based responsibility accounting. 
D)  strategy-based responsibility accounting.

Question 10

Value-added costs are standard costs based on

Accepted Answer

A)  currently attainable standards. 
B)  ideal usage standards. 
C)  cycle time. 
D)  the value added. 
A)  currently attainable standards. 
B)  ideal usage standards. 
C)  cycle time. 
D)  the value added.

Question 11

Rollo Company has developed cost formulas for the drivers of the following production activities:  
- If the actual activity was 20 setups and the actual fixed cost for inspections was $28,000 and the variable cost for inspections was $5,000, the total variance for inspections is due to

Accepted Answer

A)  favorable variance on fixed costs. 
B)  unfavorable variance on fixed costs. 
C)  favorable variance on variable costs. 
D)  unfavorable variance on variable costs. 
A)  favorable variance on fixed costs. 
B)  unfavorable variance on fixed costs. 
C)  favorable variance on variable costs. 
D)  unfavorable variance on variable costs.

Question 12

Nicolo Manufacturing has developed the following standards for its activities:
 
Assume the materials usage and purchasing costs correspond to flexible resources that acquired as needed and that inspections use resources that acquired in blocks of 2,000 hours. The actual prices paid for inputs equal the standard prices.

-
Required:

1.      Assume that continuous improvement efforts reduce the demand for inspection by 30 percent during the year, which drops the actual activity usage by 30 percent. Calculate the volume and unused capacity variances for inspection activity, materials usage and purchasing. Explain the meaning of these variances.

2.      Prepare a cost report that shows the value- and non-value-added costs.

3.      If Nicolo wants to reduce all non-value added costs by 30 percent. What Kaizen standards would be used to evaluate the company's progress? What would be the savings in resource spending?

Accepted Answer

1.  @#IMG-DLM&
The activity volume variance is a n

Question 13

Which of the following is a value-added activity?

Accepted Answer

A)  moving 
B)  inspection 
C)  processing 
D)  waiting 
A)  moving 
B)  inspection 
C)  processing 
D)  waiting

Question 14

Which of the following is NOT part of the cost dimension of the activity-based management model?

Accepted Answer

A)  resources 
B)  driver analysis 
C)  activities 
D)  cost objects 
A)  resources 
B)  driver analysis 
C)  activities 
D)  cost objects

Question 15

An example of activity reduction would be

Accepted Answer

A)  improving cycle time so the need for expediting is eliminated. 
B)  redesigning products to lead to a reduced cost set of activities. 
C)  designing a new product that uses components already used by another product. 
D)  reducing demand for customer complaint handling by improving product quality. 
A)  improving cycle time so the need for expediting is eliminated. 
B)  redesigning products to lead to a reduced cost set of activities. 
C)  designing a new product that uses components already used by another product. 
D)  reducing demand for customer complaint handling by improving product quality.

Question 16

Which of the following is NOT part of the process dimension of the activity-based management model?

Accepted Answer

A)  resources 
B)  driver analysis 
C)  activities 
D)  performance measures 
A)  resources 
B)  driver analysis 
C)  activities 
D)  performance measures

Froelech Company has developed capacity standards.Information is as follows: The unused capacity variance is

Which of the following is descriptive of activity-based responsibility accounting?

Which of the following process dimensions of the activity-based management model deals with "how well"?

Setup time for a product is 12 hours.A firm that uses JIT and produces the same product has reduced setup time to 1 hour.Setup labor is $6 per hour. -The non-value-added costs are

Which of the following is NOT a common step in an ABM implementation model?

A time-and-motion study revealed that it should take 2 hours to produce a product that currently takes 6 hours to produce.Labor is $8 per hour. The non-value-added costs are

_______________ are the resources consumed by the activity in producing its output.

The responsibility accounting system developed for operations in a continuous improvement environment would be

Value-added costs are standard costs based on

Rollo Company has developed cost formulas for the drivers of the following production activities: - If the actual activity was 20 setups and the actual fixed cost for inspections was $28,000 and the variable cost for inspections was $5,000, the total variance for inspections is due to

Which of the following is a value-added activity?

Which of the following is NOT part of the cost dimension of the activity-based management model?

An example of activity reduction would be

Which of the following is NOT part of the process dimension of the activity-based management model?

Introduction to Cost Management

Basic Cost Management Concepts

Cost Behavior

Activity-Based Costing

Product and Service Costing: Job-Order System

Process Costing

Allocating Costs of Support Departments and Joint Products

Budgeting for Planning and Control

Standard Costing: a Functional-Based Control Approach

Decentralization: Responsibility Accounting, Performance Evaluation, and Transfer Pricing

Strategic Cost Management

The Balanced Scorecard: Strategic-Based Control

Quality and Environmental Cost Management

Lean Accounting and Productivity Measurement

Cost-Volume-Profit Analysis

Activity Resource Usage Model and Tactical Decision Making

Pricing and Profitability Analysis

Capital Investment

Inventory Management: Economic Order Quantity, Jit, and the Theory of Constraints

Filters

Exam 12: Activity-Based Management

Froelech Company has developed capacity standards.Information is as follows: The unused capacity variance is

Which of the following is descriptive of activity-based responsibility accounting?

Which of the following process dimensions of the activity-based management model deals with "how well"?

Setup time for a product is 12 hours.A firm that uses JIT and produces the same product has reduced setup time to 1 hour.Setup labor is $6 per hour. -The non-value-added costs are

Which of the following is NOT a common step in an ABM implementation model?

A time-and-motion study revealed that it should take 2 hours to produce a product that currently takes 6 hours to produce.Labor is $8 per hour. The non-value-added costs are

_______________ are the resources consumed by the activity in producing its output.

The responsibility accounting system developed for operations in a continuous improvement environment would be

Value-added costs are standard costs based on

Rollo Company has developed cost formulas for the drivers of the following production activities: - If the actual activity was 20 setups and the actual fixed cost for inspections was $28,000 and the variable cost for inspections was $5,000, the total variance for inspections is due to

Which of the following is a value-added activity?

Which of the following is NOT part of the cost dimension of the activity-based management model?

An example of activity reduction would be

Which of the following is NOT part of the process dimension of the activity-based management model?

Introduction to Cost Management

Basic Cost Management Concepts

Cost Behavior

Activity-Based Costing

Product and Service Costing: Job-Order System

Process Costing

Allocating Costs of Support Departments and Joint Products

Budgeting for Planning and Control

Standard Costing: a Functional-Based Control Approach

Decentralization: Responsibility Accounting, Performance Evaluation, and Transfer Pricing

Strategic Cost Management

The Balanced Scorecard: Strategic-Based Control

Quality and Environmental Cost Management

Lean Accounting and Productivity Measurement

Cost-Volume-Profit Analysis

Activity Resource Usage Model and Tactical Decision Making

Pricing and Profitability Analysis

Capital Investment

Inventory Management: Economic Order Quantity, Jit, and the Theory of Constraints

Filters