Midterm part 1 - Cost Accounting Mid=Term Part one 1....

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Cost Accounting Mid=Term Part one 1. Question: (TCO 1) Activity-based costing systems provide better product costs when they: Your Answer: always yield more  accurate product  costs than traditional  systems employ more  activity-cost drivers employ fewer  activity-cost drivers identify and cost  more indirect cost  differences among  products CORRECT Instructor Explanation: chp 5, p145 Points Received: 5 of 5 2. Question: (TCO 1) Merriamn Company provides the following ABC costing information: Activities Total Costs Activity-cost drivers Account inquiry hours $400,000 10,000 hours Account billing lines $280,000 4,000,000 lines Account verification accounts $150,000 40,000 accounts Correspondence letters $ 50,000 4,000 letters
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Total costs $880,000 The above activities are used by Department A and B as follows: Department A Department B Account inquiry hours 2,000 hours 4,000 hours Account billing lines 400,000 lines 200,000 lines Account verification accounts
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Midterm part 1 - Cost Accounting Mid=Term Part one 1....

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