21-24 Accounting

21-24 Accounting - 106. M atch the appropriate definit ion...

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106. Match the appropriate definition with the following terms: 1. Activity-based costing Costs readily traced to a specific department because they are incurred for the sole benefit of that department. 4 2. Joint cost Cost allocation system based on separate activities and cost pools. 1 3. Cost center A department that incurs costs and generates revenues. 8 4. Direct expenses Costs which a manager can strongly influence or control. 7 5. Investment center Costs that are incurred for the joint benefit of more than one department and cannot be readily traced to only one department. 6 6. Indirect expenses A department or unit that incurs costs without directly generating revenues. 3 7. Controllable costs Costs incurred to produce two or more products at the same time. 2 8. Profit center A center in which a manager is responsible for using the center's assets to generate income for the center. 5 91. An activity-based cost allocation system: A. Is one form of a direct or variable costing system. B. Does not provide total unit cost data. C. Traces costs to products on the basis of activities performed on them. D. Does not provide for the allocation of any cost to products that cannot be directly attributable to those products.
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E. Does not involve the level of detail and the number of allocations that companies make with traditional allocation methods 88. Activity based costing can be applied to: A. Manufacturing activities only. B. Service activities only. C. Merchandising activities only. D. Any company in any industry. E. Government only.
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98. In the preparation of departmental income statements, the preparer completes the following steps in the following order: A. Identify direct expenses; allocate indirect expenses; allocate service department expenses. B. Identify indirect expenses; allocate direct expenses; allocate service department expenses. C. Identify service department expenses; allocate direct expenses; allocate indirect expenses. D. Identify direct expenses, allocate service department expenses, allocate indirect expenses. E. Allocate all expenses. 46. An expense that does not require allocation between departments is a(n): A. Common expense. B. Indirect expense. C. Direct expense. D. Administrative expense. E. All of these. 47. Expenses that are easily traced and assigned to a specific department because they are incurred for the sole benefit of that department are called: A. Direct expenses. B. Indirect expenses. C. Controllable expenses. D. Uncontrollable expenses. E. Fixed expenses.
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48. Expenses that are not easily associated with a specific department, and which are incurred for the benefit of more than one department, are: A. Fixed expenses. B.
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21-24 Accounting - 106. M atch the appropriate definit ion...

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