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Unformatted text preview: Chapter 12 Multiple Choice Quiz (See related pages) 1 Which of the following is NOT a strategic role of cost allocation? A) Determine the competitive market price. B) Determine accurate departmental and product costs. C) Motivate managers to exert a high level of effort to achieve the goals of top management. D) Provide the right incentive for managers to make decisions that are consistent with the goals of top management. E) Fairly determine the rewards earned by the managers for their effort and skill and for the effectiveness of their decision making. 2 One of the ethical issues pertaining to cost allocation is the effect of the chosen allocation method on the costs of products sold to or from foreign subsidiaries. Which method(s) would most likely be accepted by international tax authorities? A) allocations based on sales B) allocations based on tax rates C) allocations based on labor rates D) All of the above are correct. E) Only a and c are correct. 3 Which of the following is NOT one of the three types of overhead allocation? A) Direct approach B) Departmental approach C) Backflush approach D) Activity-based costing approach USE THE FOLLOWING INFORMATION TO ANSWER QUESTIONS 4 THRU 8: Gordon Manufacturing Company has two service departments, S1 and S2, and two producing departments, P1 and P2. Additionally it has the following informationGordon Manufacturing Company has two service departments, S1 and S2, and two producing departments, P1 and P2....
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This note was uploaded on 02/28/2012 for the course ACC 9000 taught by Professor Seyam during the Fall '11 term at CUNY Queens.
- Fall '11