19 x12 ABC B - CostAccountingSystems...

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Cost Accounting Systems (B. Activity-Based Cost System) B. ACTIVITY-BASED COST SYSTEM THEORIES: Outdated cost system 3. Symptoms of an outdated cost system include all of the following EXCEP A. product costs change because of changes in financial reporting. B. products that are difficult to produce show little profit. C. competitors' prices appear unrealistically low. D. the company has a highly profitable niche all to itself. 13. Which of the following is NOT a sign of poor cost data? A. Competitors' prices for high-volume products appear much too high. B. The company seems to have a highly profitable niche all to itself. C. Customers don't balk at price increases for low-volume products. D. Competitors' prices for low-volume products appear much too high. Activity-based management 1. Which system focuses on the management of activities with the objective of improving the value received by the customer and the profit received by providing this value? A. activity-based management C. contemporary cost control B. traditional cost management system D. standard cost system 28. Activity-based management (ABM) is A. a costing system in which multiple overhead cost pools are allocated using bases that include one or more nonvolume related factors B. a base used to allocate the cost of a resource to the different activities using it C. the use of information obtained from ABC to make improvements in the firm D. a base used to allocate the cost of an activity to products and customers 17. An objective of activity-based management is to A. eliminate the majority of centralized activities in an organization. B. reduce or eliminate non-value-added activities incurred to make a product or provide a service. C. institute responsibility accounting systems in decentralized organizations. D. all of the above 5. Primary concepts under activity-based management include all of the following except: A. activity analysis C. activity-based costing B. total quality management D. cost driver analysis 18. Which of the following falls under the Activity-Based Management umbrella? Continuous improvement Business process reengineering Activity-based costing A. NO NO YES B. YES NO NO C. YES YES YES D. NO YES NO 29. All of the following are ways that activities can be managed to achieve improvements in a process, except A. activity induction C. activity elimination B. activity selection D. activity sharing Traditional Costing vs. ABC system 27. Which of the following is not a distinction between the traditional and ABC costing systems A. the number of overhead cost pools tends to be higher in ABC systems B. the number allocation bases tend to be higher in ABC system C. costs within an ABC cost pool tend to be more homogeneous than the costs within a traditional system’s cost pool D. all ABC systems are one-stage costing systems, while traditional systems may be one- or two-stage 32. In contrast to a company that uses a single overhead rate, one that uses 1
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Cost Accounting Systems (B. Activity-Based Cost System) activity-based costing A. will have higher product costs than one using a single overhead rate.
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This note was uploaded on 11/22/2010 for the course CAC BSA taught by Professor Kairus during the Spring '10 term at Korea University.

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19 x12 ABC B - CostAccountingSystems...

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