Accounting Exam 2

______ Level Activities: Performed for each batch of product?

Batch

The difference between super variable costing net operating income and variable costing net operating income is explained by their different approaches to accounting for _______________?

Direct labor costs

______ Level Activities: Required to support or sustain an entire production process

Facility

Most companies that use activity based costing replace their traditional accounting system with it.

False

True or false: Traditional cost systems tend to overcost standard products and overcost specialty products.

False

In a traditional cost accounting system, what type of costs are assigned to products even if the costs are not caused by the products?

Manufacturing

____________ costs are all other indirect costs that are incurred in production.

Period

---------- costs are those directly related to the production of a product or service intended for sale.

Product

______ Level Activities: Performed in support of an entire product line, but not always performed every time a new unit or batch is produced?

Product

Activity-based costing uses activity rates to apply overhead costs to products in ________ allocation.

Second stage

4th step in the implementation of ABC is _______________ aka Assign Overhead Costs to Cost of Object

Second stage allocation

Which costing method assigns only manufacturing costs to products?

Traditional absorption costing

______ Level Activities: Performed for each unit of production?

Unit

The first major step in implementing ABC is to identify the ---------- that will form the foundation for the system.

activities

In activity-based costing, each cost pool accumulates costs that relate to a single ----------- measure in the ABC system.

activity

A "bucket" in which costs are accumulated that relate to a single activity measure in the ABC system is a(n)-------------

activity cost pool

In the second stage allocation of overhead costs, we use ________ to assign costs to cost objects?

activity rate

In activity-based costing, the consumption of overhead resources is caused by:

an activity

Activity based costing provides managers with information that affects:

both fixed and variable costs

In activity-based costing, nonmanufacturing and manufacturing costs are assigned to products on a(n) ______ basis.

cause and effect

Time-driven activity-based costing (TDABC) ______ require extensive interviews with employees.

doesn't

An activity cost pool accumulates costs for ______ activity measure(s).

exactly one

Individual product costs calculated using ABC are not listed on ______ reports.

external

the process used to assign overhead costs to activities. This allocation is employed in an activity-based costing system, and is the first step in the eventual allocation of overhead costs to cost objects.

first stage allocation

Usually, traditional costing ______ high-volume products and ______ low-volume products.

overcosts, undercosts

In activity-based costing, first-stage allocation assigns---------- costs to activity cost pools.

overhead

n activity-based costing, first-stage allocation assigns ------------ costs to activity cost pools.

overhead

The most common reports prepared using ABC data are the product and customer -------------- reports.

profitability

The system of accountability in which managers are held responsible for those items of revenue and costs and only those items over which they can exert significant control is referred to as ______________?

responsibility accounting

Activity rates are used to apply overhead costs to products and customers in the ------------ -stage allocation.

second

All manufacturing costs are assigned to products in activity----------- costing.

traditional