LS CH7

ABC systems assign nonmanufacturing overhead on a(n) ____-and-_____ basis

cause effect

T/F: Activity-based costing assigns all costs of production to the product, based on volume produced.

False

T/F: activity-based costing assigns all costs of production to the product, based on volume produced

False

in the ease of adjustment coding scheme, which of the following are usually considered yellow costs?

- direct labor - factory utilities

Which costs are assigned and/or traced when computing product margin in a traditional cost system? (check all that apply)

- direct materials - direct labor - manufacturing overhead

activity-based costing product costs include. (check all that apply)

- manufacturing costs - non manufacturing costs

In the ease of adjustment coding scheme, which of the following are usually considered Green costs?

- shipping - Direct materials

what manufacturing overhead costs are not assigned to products in activity based costing?

- the costs of organization-sustaining activities - the costs of idle capacity

which of the following costs can be easily traced to individual products.

- warranty repair costs - shipping costs - sales commission

Automation in manufacturing has led to:

-An increase in overhead costs -A decrease in direct labor as a percentage of total cost

The action analysis report:

-Identifies costs that have been assigned to a product - Provides better information for decision making than a traditional cost system - Shows how difficult it would be to adjust costs given changes in activities.

If there are three customer orders containing 10 units each, what is the total number of batches?

3

In ABC, any event that causes consumption of overhead resources is a(n)____.

activity

In____ - ____ costing, only the capacity used is allocated to product costs

activity based

one reason why activity-based costing is not used for external reporting is because it is very _____ to change a company's accounting system

difficult

calculating activity rates for an action analysis report:

involves more detail than calculating activity rates using traditional abc costing

customer sales minus direct material, direct labor, and overhead cost pools used for each customer equal customer ____.

margin

the best team to create an ABC system should include employees from which department

marketing

Under activity-based costing, nonmanufacturing costs

may be assigned to products on a cause-and effect basis

Activities that occur regardless of which customers are served, which products are produced or how many batches are run or units made are ____-____ activities.

organization-sustaining

Simple counts of the number of times an activity occurs are ____ drivers.

transaction

in the ease of adjustment coding scheme, ____ costs can adjust in response to changes in activity, but require management action.

yellow