Question 1

Traditional costing systems generally allocate nonproduction value-chain costs to products.

Accepted Answer

A) True 
 B)False

Question 2

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

Accepted Answer

A) True 
 B)False

Question 3

Customers and company activities are examples of cost objects.

Accepted Answer

A) True 
 B)False

Question 4

A period cost is ________.

Accepted Answer

A) associated with production value-chain functions 
B) associated with nonproduction value-chain functions 
C) reported as an inventoriable cost 
D) reported as a product cost 
A) associated with production value-chain functions 
B) associated with nonproduction value-chain functions 
C) reported as an inventoriable cost 
D) reported as a product cost

Question 5

What type of users need aggregate cost information about products or services?

Accepted Answer

A) managers 
B) external users 
C) factory supervisors 
D) internal users 
A) managers 
B) external users 
C) factory supervisors 
D) internal users

Question 6

A value-added cost is the cost of an activity that a company can eliminate without affecting the product's value to the customer.

Accepted Answer

A) True 
 B)False

Question 7

Process maps are used ________.

Accepted Answer

A) to make investment decisions regarding capital assets 
B) as a guide for strategic decisions 
C) as a tool for managers to understand operations 
D) as a tool for accountants to develop a cost accounting system 
A) to make investment decisions regarding capital assets 
B) as a guide for strategic decisions 
C) as a tool for managers to understand operations 
D) as a tool for accountants to develop a cost accounting system

Question 8

The following information was obtained from the accounting records of Stevie Nicks Incorporated:   What is Cost of Goods Sold?

Accepted Answer

A) $207,000 
B) $211,000 
C) $227,000 
D) $231,000 
A) $207,000 
B) $211,000 
C) $227,000 
D) $231,000

Question 9

A reason more organizations are adopting activity-based costing systems is the complexity of manufacturing operations.

Accepted Answer

A) True 
 B)False

Question 10

When determining the product cost of a manufactured product,________.

Accepted Answer

A) direct material costs include minor items such as tacks or glue 
B) direct labor costs may not include employee benefits 
C) indirect production costs may include selling costs 
D) there may be no direct labor costs 
A) direct material costs include minor items such as tacks or glue 
B) direct labor costs may not include employee benefits 
C) indirect production costs may include selling costs 
D) there may be no direct labor costs

Question 11

Which of the following is an example of a value-added cost to a manufactured product?

Accepted Answer

A) the cost of handling inventory 
B) the cost of storing inventory 
C) changing the setup of production-line operations 
D) the depreciation expense of robots that assemble the product 
A) the cost of handling inventory 
B) the cost of storing inventory 
C) changing the setup of production-line operations 
D) the depreciation expense of robots that assemble the product

Question 12

An unallocated cost of one company may be an allocated cost in another company.

Accepted Answer

A) True 
 B)False

Question 13

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

Accepted Answer

A) merchandise inventory,beginning balance 
B) merchandise inventory,ending balance 
C) purchases of direct materials 
D) purchases of merchandise 
A) merchandise inventory,beginning balance 
B) merchandise inventory,ending balance 
C) purchases of direct materials 
D) purchases of merchandise

Question 14

A traditional costing system would be appropriate if a company ________.

Accepted Answer

A) manufactures hundreds of different products 
B) has complex production operations 
C) manufactures simple and complicated products 
D) has a plausible and reliable relationship between a single cost driver and all the indirect resource costs being allocated 
A) manufactures hundreds of different products 
B) has complex production operations 
C) manufactures simple and complicated products 
D) has a plausible and reliable relationship between a single cost driver and all the indirect resource costs being allocated

Question 15

A(n)________ is the cost of an activity that cannot be eliminated without affecting a product's value to the customer.

Accepted Answer

A) inventoriable cost 
B) unallocated cost 
C) value-added cost 
D) non-value-added cost 
A) inventoriable cost 
B) unallocated cost 
C) value-added cost 
D) non-value-added cost

Question 16

The following information was taken from the accounting records of Jackson Manufacturing Company:
   What is Cost of Goods Manufactured? 
A)$111,000
B)$113,000
C)$130,000
D)$132,000

Accepted Answer

B ($76,000

Question 17

A merchandising company has raw materials inventory.

Accepted Answer

A) True 
 B)False

Question 18

Collecting cost and operational data is the first step in the design of an Activity-Based Costing system.

Accepted Answer

A) True 
 B)False

Question 19

A cost is a sacrifice of resources for a particular purpose.

Accepted Answer

A) True 
 B)False

Question 20

Why are more organizations adopting activity-based costing systems?

Accepted Answer

A) Computer technology has increased the costs of developing and operating ABC systems. 
B) Indirect costs are not important in automated manufacturing environments. 
C) Shortened product life cycles. 
D) Less diversity in product mix offered to customers. 
A) Computer technology has increased the costs of developing and operating ABC systems. 
B) Indirect costs are not important in automated manufacturing environments. 
C) Shortened product life cycles. 
D) Less diversity in product mix offered to customers.

Traditional costing systems generally allocate nonproduction value-chain costs to products.

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

Customers and company activities are examples of cost objects.

A period cost is ________.

What type of users need aggregate cost information about products or services?

A value-added cost is the cost of an activity that a company can eliminate without affecting the product's value to the customer.

Process maps are used ________.

The following information was obtained from the accounting records of Stevie Nicks Incorporated: What is Cost of Goods Sold?

A reason more organizations are adopting activity-based costing systems is the complexity of manufacturing operations.

When determining the product cost of a manufactured product,________.

Which of the following is an example of a value-added cost to a manufactured product?

An unallocated cost of one company may be an allocated cost in another company.

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

A traditional costing system would be appropriate if a company ________.

A(n)________ is the cost of an activity that cannot be eliminated without affecting a product's value to the customer.

The following information was taken from the accounting records of Jackson Manufacturing Company: What is Cost of Goods Manufactured? A)$111,000 B)$113,000 C)$130,000 D)$132,000

A merchandising company has raw materials inventory.

Collecting cost and operational data is the first step in the design of an Activity-Based Costing system.

A cost is a sacrifice of resources for a particular purpose.

Why are more organizations adopting activity-based costing systems?

Managerial Accounting, the Business Organization

Introduction to Cost Behavior and Cost-Volume Relationships

Measurement of Cost Behavior

Relevant Information for Decision Making With a Focus

Relevant Information for Decision Making With a Focus

Introduction to Budgets and Preparing the Master Budget

Flexible Budgets and Variance Analysis

Management Control Systems and Responsibility Accounting

Management Control in Decentralized Organizations

Capital Budgeting

Cost Allocation

Accounting for Overhead Costs

Job-Order Costing and Process-Costing Systems

Basic Accounting: Concepts, techniques, and Conventions

Understanding Corporate Annual Reports: Basic Financial Statements

Understanding and Analyzing Consolidated Financial Statements

Filters

Exam 4: Cost Management Systems and Activity-Based Costing

Traditional costing systems generally allocate nonproduction value-chain costs to products.

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

Customers and company activities are examples of cost objects.

A period cost is ________.

What type of users need aggregate cost information about products or services?

A value-added cost is the cost of an activity that a company can eliminate without affecting the product's value to the customer.

Process maps are used ________.

The following information was obtained from the accounting records of Stevie Nicks Incorporated: What is Cost of Goods Sold?

A reason more organizations are adopting activity-based costing systems is the complexity of manufacturing operations.

When determining the product cost of a manufactured product,________.

Which of the following is an example of a value-added cost to a manufactured product?

An unallocated cost of one company may be an allocated cost in another company.

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

A traditional costing system would be appropriate if a company ________.

A(n)________ is the cost of an activity that cannot be eliminated without affecting a product's value to the customer.

The following information was taken from the accounting records of Jackson Manufacturing Company: What is Cost of Goods Manufactured? A)$111,000 B)$113,000 C)$130,000 D)$132,000

A merchandising company has raw materials inventory.

Collecting cost and operational data is the first step in the design of an Activity-Based Costing system.

A cost is a sacrifice of resources for a particular purpose.

Why are more organizations adopting activity-based costing systems?

Managerial Accounting, the Business Organization

Introduction to Cost Behavior and Cost-Volume Relationships

Measurement of Cost Behavior

Relevant Information for Decision Making With a Focus

Relevant Information for Decision Making With a Focus

Introduction to Budgets and Preparing the Master Budget

Flexible Budgets and Variance Analysis

Management Control Systems and Responsibility Accounting

Management Control in Decentralized Organizations

Capital Budgeting

Cost Allocation

Accounting for Overhead Costs

Job-Order Costing and Process-Costing Systems

Basic Accounting: Concepts, techniques, and Conventions

Understanding Corporate Annual Reports: Basic Financial Statements

Understanding and Analyzing Consolidated Financial Statements

Filters