What are the conditions that would indicate to the management of a firm that they should...
What are the conditions that would indicate to the management of a firm that they should switch from traditional costing to activity-based costing?
Homework Answers
Conditions that would indicate the requirement to switch from
traditional costing to activity based costing of a firm:
1) Overhead costs constitute a significant portion of total
costs.
2) The manufacturing process or the number of products has changed
significantly.
3) Product lines differ greatly in volume and manufacturing
complexity.
4) Product lines are numerous and diverse, and they require
differing degrees of support services.
5) Production or marketing managers are ignoring data provided by
the existing system and are instead using alternative data when
pricing or making other product decisions.
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What are the conditions that would indicate to the management of
a firm that they should...
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Which of the following conditions normally would not indicate that standard costs should be revised? Oa....
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You are a Controller at a manufacturing company. You have been going over the numbers for...
You are a Controller at a manufacturing company. You have been going over the numbers for manufacturing overhead and you don't think the company is using the best method to assign it. Recently you heard about activity based costing and have done research into it. You believe that it would be in the company's best interest to switch from its traditional method for assigning manufacturing overhead to activity based costing. Write a memo to the CEO explaining the benefits the...
You are a Controller at a manufacturing company. You have been going over the numbers for...
You are a Controller at a manufacturing company. You have been going over the numbers for manufacturing overhead and you don't think the company is using the best method to assign it. Recently you heard about activity based costing and have done research into it. You believe that it would be in the company's best interest to switch from its traditional method for assigning manufacturing overhead to activity based costing. Write a memo to the CEO explaining the benefits the...
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Explain how ABC (Activity Based Costing) give an accurate evaluation of management performance in comparison to traditional costing method
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2. Under what conditions should a competitive firm shut down in the short run? Also show...
2. Under what conditions should a competitive firm shut down in the short run? Also show it in a graph.
Which of the following conditions normally would not indicate that standard costs should be revised? Oa. Actual costs differed from standard costs for the preceding week. ob. The average price of raw materials increased from $4.68 per pound to $4.82 per pound. OC. The engineering department has revised product specifications in responding to customer suggestions. od. The company has signed a new union contract that increases the factory wages on average by $3.50 an hour.
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2. Under what conditions should a competitive firm shut down in the short run? Also show it in a graph.
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