Labor and overhead activities activities should not

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Why is top management support needed when ABC is implemented? Labor and overhead activities Activities should not be combined in activity based costing Batch and product level activities Highly correlated activities Which of the following can be combined in activity-based costing? Identifying the activities that will form the foundation for the system:
often involves interviewing employees involves a great deal of judgment can be time-consuming is usually the easiest step in the process Identifying the activities that will form the foundation for the system: first-stage fourth-stage third-stage second-stage In activity-based costing, ______ allocation is the process of assigning overhead costs to activity cost pools. strong support from a cross-functional team top management design and implementation a link to how people are evaluated and rewarded A characteristic essential for successful implementation of ABC is: shipped orders power to run machines products designed customer orders Activities that could be combined into one batch-level activity are the number of: 2,000 4,250 1,700 2,500 If the activity rate for the customer order cost pool is $250 per order and the total for this cost pool is $425,000, the total number of customer orders is: True False True or false: In an activity-based costing system, it is best to combine activities that are not highly correlated.
False product profitability customer profitability first-stage allocation second-stage allocation The most common management reports using ABC data are: transaction drivers cost pools allocation bases activity rates Total cost of each activity divided by the total activity is the computation of: Total estimated manufacturingoverheadis $900,000 andtotalestimated activity is 30,000 machine-hours.Theplantwideoverhead rate is $30 per machine hour. do nothing; product margin is equal to net income/loss subtract overhead costs not assigned to products add overhead costs not assigned to products To reconcile ABC product margin to net income: undercosts; overcosts overcosts; overcosts overcosts; undercosts undercosts; undercosts Usually, traditional costing ______ high-volume products and ______ low- volume products. Activity rates are used to applyoverhead costs to productsand customersin the second -stage allocation. In activity-basedcosting, first-stage allocation assigns overhead costs to activity cost pools. Focusingon activities to eliminate waste, decrease processing time, and reduce defects is the basisof activity-basedmanagement .
True False True or false: Traditional cost systems tend to overcost standard products and overcost specialty products. increasing processing time eliminating waste pricing decisions Reducing defects Activity-based management is focused on: External reports are (more/ less) detailed thaninternal reports. The most commonreports prepared using ABC data are the productand customer profitability reports.

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