chapter8 - T rue/False Questions 1. I f a manufacturing...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
True/False Questions 1. If a manufacturing company is using activity-based costing for internal purposes only, then organization-sustaining overhead costs should not be allocated to any of the products. Ans: True AACSB: Reflective Thinking AICPA BB: Critical Thinking AI CPA FN: Reporting LO: 1 Level: Medium 2. Batch-level activities are performed each time a batch of goods is handled or processed. Ans: True AACSB: Reflective Thinking AICPA BB: Critical Thinking AI CPA FN: Reporting LO: 1 Level: Easy 3. Organization-sustaining activities are carried out regardless of how many units are made, how many batches are run, or how many different products are made. Ans: True AACSB: Reflective Thinking AICPA BB: Critical Thinking AI CPA FN: Reporting LO: 1 Level: Easy 4. Direct labor-hours or direct labor cost should not be used as a measure of activity in an activity-based costing system. Ans: False AACSB: Reflective Thinking AICPA BB: Critical Thinking AI CPA FN: Reporting LO: 1 Level: Medium 5. Activity-based costing is a costing method that is designed to provide managers with cost information for strategic and other decisions that potentially affect capacity and therefore "fixed" costs. Ans: True AACSB: Reflective Thinking AICPA BB: Critical Thinking AI CPA FN: Reporting LO: 1 Level: Easy 6. Activity-based costing is a costing method that is designed to provide managers with cost information for strategic and other decisions that potentially affect only variable costs. Ans: False AACSB: Reflective Thinking AICPA BB: Critical Thinking AI CPA FN: Reporting LO: 1 Level: Medium Garrison/Noreen/Brewer, Managerial Accounting, Twelfth Edition 8-5
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
7. A duration driver provides a measure of the amount of time required to perform an activity. Ans: True AACSB: Reflective Thinking AICPA BB: Critical Thinking AICP A FN: Reporting LO: 1 Level: Mediwn 8. In general, transaction drivers are more accurate measures of the conswnption of resources than duration drivers. Ans: False AACSB: Reflective Thinking AICPA BB: Critical Thinking AI CPA FN: Reporting LO: 1 Level: Mediwn 9. The costs of idle capacity should not be assigned to products in activity-based costing. Ans: True AACSB: Reflective Thinking AICPA BB: Critical Thinking AI CPA FN: Reporting LO: 1 Level: Easy 10. In traditional costing systems, all manufacturing costs are assigned to products--even manufacturing costs that are not caused by the products. Ans: True
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 9

chapter8 - T rue/False Questions 1. I f a manufacturing...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online