1. The major limitation of volume-based costing systems is the use of volume-based: A. Criteria. B..

 
   

Need your ASSIGNMENT done? Use our paper writing service to score better and meet your deadlines.  

1.
The major limitation of volume-based
costing systems is the use of volume-based:
A.
Criteria.
B.
Standards.
C.
Rates.
D.
Variances.
E.
Restrictions.

2.
Volume-based rates produce inaccurate
product cost when:
A.
A large share of factory
overhead cost is not volume-based.

B.
Firms produce a diverse
mix of products.
C.
Large volumes of a
product are manufactured.
D.
Both answer A and answer
B are correct.
E.
None of the answers
above is correct.

3.
If the usage of project
activities is not proportional to the number of units produced, then some
managers will be overcharged and others undercharged under the:

A.
Activity-based costing
B.
Volume-based costing
C.
Overhead costing
D.
Process costing

4.
Volume-based overhead rates may cause
undesirable strategic effects such as:
A.
Incorrect decisions.

B.
Unprofitable
cross-subsidization of products.
C.
Ineffective management
of operations for process improvement.
D.
Answers A, B and C are
all correct.
E.
None of the answers
above is correct.

5.
Activity-based costing
(ABC) differs from other costing approaches in that it more accurately measures
the cost of activities:

A.
Not proportional to the
volume of outputs produced.
B.
Directly proportional to
the volume of outputs produced.
C.
Inversely proportional
to the volume of outputs produced.
D.
That are non-value
adding.
E.
At a significantly lower
cost in time and money.

6.
In performing activity
analysis during the design of an activity-based costing system (ABC), the
management accountant studies:

A.
The cost drivers and
managers in the plant.
B.
The advice of
operation-level managers.
C.
The resources,
activities and cost drivers in the operation.
D.
The cost allocation
methods applicable to the firm
E.
The implementation
problems for an ABC system.

7.
Effective implementation of
activity-based costing (ABC) requires:
A.
Normally the assistance
of a consultant.

B.
A sophisticated and
expensive computer system.
C.
Support of top
management and key employees.
D.
Capturing properly the
complexity of the data.
E.
ABC has no significant
implementation issues.

8.
Elimination of low-value-added
activities in a firm should:
A.
Be discouraged because
of potential harmful effects.
B.
Not affect customer
value.
C.
Not have priority
because low-value-added activities have little effect on a firm’s performance.
D.
Have priority only when
a firm is operating at a loss.
E.
Happen naturally if the
firm is well-managed.

9.
When gathering activity
data, which of the following would not be a question that ABC project team
members typically ask employees or managers?

A.
Time spent performing
the activity
B.
Resources required for
the activity
C.
Where the activity takes
place
D.
Value the activity has
for the customer

10.
Successful activity-based costing (ABC)
implementation depends upon the firm:
A.
Having support of
consultants with needed expertise.

B.
Having a thorough
activity analysis.
C.
Starting with a
relatively simple system.
D.
Having well-trained
managers.
E.
Having adequate computer
resources.