Which of the following is not true regarding activity-based costing? a.Product costs are used to establish...
Which of the following is not true regarding activity-based costing?
a.Product costs are used to establish product price.
b.Product costs are used to determine whether to discontinue a product line.
c.The allocation of factory overhead affects the accuracy of product costs.
d.None of these statements are false.
Homework Answers
Ans: d.None of these statements are false.
Activity-Based Costing or ABC can be applied to both manufacturing and service-oriented firms. Installing an ABC system begins with an analysis of the types of transactions that generate costs in each support department. Cost Analysts examine each department to understand what drives the costs in that support department.
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Which of the following is not true regarding activity-based
costing?
a.Product costs are used to establish...
2. The more activities tracked by activity-based costing, the more accurately overhead costs are assigned True...
2. The more activities tracked by activity-based costing, the more accurately overhead costs are assigned True False 3. From an ABC perspective, what causes costs to be incurred? A. Financial transactions. B. The volume of units produced. C. Debits and credits. D. Management decisions E. Activities. 4. A method of assigning overhead costs to a product using a single overhead rate is: A. Plantwide overhead rate method. B. Cost pool overhead rate method. C. Departmental overhead rate method. D. Activity-based...
Which of the following statements about activity-based costing is false? Activity-based costing is most appropriate for...
Which of the following statements about activity-based costing is false? Activity-based costing is most appropriate for a firm that produces similar products that use similar resources. Activity-based costing requires a two-stage allocation of costs. Activity-based costing categorizes costs as unit-level, batch-level, product-level, or organization-sustaining. Activity-based costing can be used for manufacturing, administrative, or selling costs.
True or False: Activity-based costing (ABC) techniques used to evaluate customer profitability can also be applied...
True or False: Activity-based costing (ABC) techniques used to evaluate customer profitability can also be applied to evaluating suppliers. True or False: Quality can be defined as the degree to which a product or service performs as it was designed to do. True or False: The basic concepts involved in activity-based costing (ABC) can be used to determine customer profitability as well as product costs. True or False: Tangible customer expectations include how the product's salespeople treat customers and the...
Indicate whether each of the following statements is true or false. _____ Activity-based costing always delivers...
Indicate whether each of the following statements is true or false. _____ Activity-based costing always delivers significantly more accurate cost allocation than does volume-based costing. _____ A special order decision involves an offer to purchase goods at a price that is lower than normal. _____ To analyze a special order decision, a manager should identify differential costs and revenues. _____ A special order should be accepted if avoidable costs exceed differential revenue.
Which of the following statements is true of activity-based costing?
Which of the following statements is true of activity-based costing?Multiple ChoiceABC ignores the allocation of marketing costs.ABC classifies some indirect costs as direct costs. products.ABC is more likely to result in big differences from a traditional costing system if the business makes only one product rather than multiple products.Activities are the cost objects of the second stage of ABC.Production costs per tennis racket total $ 38, which consists of $ 25 in variable production costs and $ 13 in fixed...
Which of the following is true regarding activity based costing ? A. The benefits of using...
Which of the following is true regarding activity based costing ? A. The benefits of using ABC always outweigh its limitations B. The lower the proportion of overhead costs as compared to direct materials and direct labor costs, the more likely a company will benefit from using ABC C. Companies with a high proportion of non unit level costs should rarely use ABC D. High measurements costs associated with ABC may deter some companies from its use
An activity measure in activity-based costing expresses how much of an activity is carried out and...
An activity measure in activity-based costing expresses how much of an activity is carried out and it is used as the allocation base for assigning overhead costs to products and services. True or False
9. Which of the following statements is true? a. Activity-based costing uses a number of activity...
9. Which of the following statements is true? a. Activity-based costing uses a number of activity cost pools, each of which is allocated to products on the basis of direct labor-hours. b. Activity rates in activity-based costing are computed by dividing costs from the first stage allocations by the activity measure for each activity cost pool. C. An activity-based costing system is generally easier to implement and maintain than traditional costing system. d. One of the goals of activity-based costing...
When activity-based costing is used to apply overhead to products, support department costs are referred to...
When activity-based costing is used to apply overhead to products, support department costs are referred to as a.department activity costs b.support activity costs c.activity-based department costs d.multiple activity costs In the process of applying overhead using multiple production department rates, overhead costs are directly traced to support and production departments and are then allocated to production departments based on the amount of support activity used by each department. True False The physical units method and the weighted average method are...
Which of the following measures is not used by activity-based costing (ABC) systems as an allocation...
Which of the following measures is not used by activity-based costing (ABC) systems as an allocation base for allocating overhead costs to the units produced? Multiple Choice C) Volume-related activities Batch-related activities. Product-related activities ooo O Need-related activities.
2. The more activities tracked by activity-based costing, the more accurately overhead costs are assigned True False 3. From an ABC perspective, what causes costs to be incurred? A. Financial transactions. B. The volume of units produced. C. Debits and credits. D. Management decisions E. Activities. 4. A method of assigning overhead costs to a product using a single overhead rate is: A. Plantwide overhead rate method. B. Cost pool overhead rate method. C. Departmental overhead rate method. D. Activity-based...
Which of the following statements is true of activity-based costing?Multiple ChoiceABC ignores the allocation of marketing costs.ABC classifies some indirect costs as direct costs. products.ABC is more likely to result in big differences from a traditional costing system if the business makes only one product rather than multiple products.Activities are the cost objects of the second stage of ABC.Production costs per tennis racket total $ 38, which consists of $ 25 in variable production costs and $ 13 in fixed...
9. Which of the following statements is true? a. Activity-based costing uses a number of activity cost pools, each of which is allocated to products on the basis of direct labor-hours. b. Activity rates in activity-based costing are computed by dividing costs from the first stage allocations by the activity measure for each activity cost pool. C. An activity-based costing system is generally easier to implement and maintain than traditional costing system. d. One of the goals of activity-based costing...
Which of the following measures is not used by activity-based costing (ABC) systems as an allocation base for allocating overhead costs to the units produced? Multiple Choice C) Volume-related activities Batch-related activities. Product-related activities ooo O Need-related activities.
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