Cost Multiple Choice Exam 2

only variable costs are included in activity-cost pools

A basic assumption of activity-based costing (ABC) is that:

total fixed costs will not change

Which of the following is correct regarding a relevant range?

Print shop Beverage manufacturer

Which one of the following alternatives correctly classifies the business application to the appropriate costing system?

increases and sales price remains unchanged

Breakeven point in units increases when unit costs:

whether the cost can be easily traced with the object

Classifying a cost as either direct or indirect depends upon:

Equivalent units=Number of partially completed units x % complete

Equivalent units is computed using which of the following formulas?

be used in the computation of the contribution margin

In an income statement prepared as an internal report using the variable costing method, variable selling and administration expenses would:

be used in the computation of net operating income but not in the computation of the contribution margin

In an income statement prepared using the variable costing method, fixed manufacturing overhead would:

various products are manufactured that do not pass through the same departments or use the same manufacturing techniques

Multiple or departmental overhead rates are considered preferrable to a single or plantwide overhead rate when:

the amount od the unit contribution margin for each additional unit sold

One the break-even point has been reached, net operating income will increase by:

the service departments

The reciprocal method of departmental cost allocation is preferred over the step method because it takes into account all the reciprocal flows between: