Ch05_Guan CM_AISE TB

Ch05_Guan CM_AISE TB - Chapter 5Product and Service...

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Chapter 5—Product and Service Costing: Job-Order System MULTIPLE CHOICE 1. A pure service organization involves: a. no raw materials, no inventories, and a definite separation between a plant and the custom- er. b. raw materials, tangible items, and no separation between a plant and the customer. c. no raw materials, no tangible items, and no separation between a plant and the customer. d. none of the above ANS: C PTS: 1 OBJ: 5-1 2. Homogenous products refer to: a. products produced in large quantities and are very similar in nature. b. the nonphysical nature of services and opposed to products. c. the greater chances for variation in the performance of services. d. the fact that services cannot be inventoried but must be consumed when performed. ANS: A PTS: 1 OBJ: 5-1 3. Which of the following is a pure service? a. bungee jumping b. barber shop c. restaurant d. software ANS: A PTS: 1 OBJ: 5-1 4. Which of the following is a manufactured product? a. bungee jumping b. barber shop c. restaurant d. automobile ANS: D PTS: 1 OBJ: 5-1 5. Intangibility refers to a. the nonphysical nature of services as opposed to products. This may not be resold, copied, or distributed without the prior consent of the publisher.
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b. the fact that production and consumption are inseparable for services. c. the greater chances for variation in the performance of services than in the production of products. d. the fact that services cannot be inventoried but must be consumed when performed. ANS: A PTS: 1 OBJ: 5-1 6. Which of the following organizations could use process costing? a. A custom furniture builder b. A dental office that offers a wide range of services to the patients c. Contractors who build a large volume of homes each year, each with amenities selected by the future owners d. Discount Stockbrokers ANS: D PTS: 1 OBJ: 5-1 7. Which of the following firms would make extensive use of service costing? a. auto manufacturer b. furniture manufacturer c. auto dealer d. CPA firm ANS: D PTS: 1 OBJ: 5-1 8. Manufacturers producing unique or customized products would employ a(n) a. process costing system b. job-costing system c. homogeneous costing system d. all of the above ANS: B PTS: 1 OBJ: 5-1 9. Which of the following products would NOT use job-order costing? a. houses b. chemicals c. ships d. custom-built furniture ANS: B PTS: 1 OBJ: 5-1 10. Process costing would be most applicable for
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a. an electronics producer b. custom machining c. high rise building construction d. CPA audits ANS: A PTS: 1 OBJ: 5-1 11. Which of the following would NOT use a process costing system? a. electrical wire b. cotton yarn c. newsprint d. satellites ANS: D PTS: 1 OBJ: 5-1 12. Which cost accounting process would be most appropriate for accumulating costs of identical, stand- ardized units? a.
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Ch05_Guan CM_AISE TB - Chapter 5Product and Service...

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