ACCT 226 - Ch. 19 Tell Me More
In the context of allocating support department costs to production departments, the __________ considers all inter-support-department services and is the most difficult to implement when a large number of departments is involved. a. Sequential method b. Direct method c. Reciprocal services method d. Step-down method
c
When a single manufacturing process generates multiple outputs, it is called a ________. a. continuous manufacturing process b. batch manufacturing process c. joint manufacturing process d. serial manufacturing process
c
When the __________ method is used to apply overhead to products, overhead costs are first directly traced or distributed to support and manufacturing departments. a. activity-based costing b. single plantwide rate c. multiple production department rates d. None of the above
c
In the context of activity-based costing, transferring overhead costs to support and production departments is referred to as __________ overhead costs. a. assigning b. allocating c. applying d. distributing
d
In the context of allocating support department costs to production departments, which of the following methods is the easiest but the least accurate? a. Step-down method b. Reciprocal services method c. Sequential method d. Direct method
d
Tristate Fish Company noticed that their production department had overrun cost targets for the year. They decided to reduce the bonus of the manager of the department, Richard, because of the excess costs. Which of the following arguments can Richard make to avoid the reduction in bonus? a. The significant portion of the output for the year had to be reworked due to faulty raw materials used during the production phase. a. The significant portion of the output for the year had to be reworked due to faulty raw materials used during the production phase. b. The overall costs increased due to an increase in wages per employee for the year. c. The overrun costs were primarily due to an increase in commissions paid. d. The joint costs of production were allocated based on net realizable value and made up a sizeable portion of the total costs.
d
Which of the following departments is necessary for production, but is not directly involved in production? a. Manufacturing department b. Construction department c. Production department d. Maintenance department
d
Which of the four common methods for allocating joint costs is likely to allocate joint costs based on the type of labor needed for each product? a. The physical units method b. The net realizable value method c. The market value at split-off method d. The weighted average method
d
Which of the four common methods for allocating joint costs is the most appropriate if management wants joint cost allocations to reflect the difficulty with which products are made? a. Weighted average method b. Market value at split-off method c. Net realizable value method d. Physical units method
a
IF YOU SEE THIS QUESTION ON EXAM JUST REMEMBER THE ANSWER. QUIZLET IS BEING STUPID AND NOT LETTING ME UPLOAD PHOTO Hera Inc. has four production departments: Molding, Cutting, Welding, and Polishing. The company incurred joints costs of $1,000,000 during the year. The allocation of the joint costs of production is done based on the net realizable value of the output. We are provided with the following details for Hera Inc. Which of the departments will experience the most adverse impact due to the allocation of joint costs? a. Molding department b. Cutting department c. Welding department d. Polishing department
a
In the context of allocating support department costs to production departments, which of the following methods is the most difficult but the most accurate? a. Reciprocal services method b. Step-down method c. Direct method d. Sequential method
a
Support departments are sometimes known as ________. a. service departments b. marketing departments c. production departments d. manufacturing departments
a
Jean is the manager of the manufacturing department in company called Tyche. During the year, Jean discovered that she had exceeded the cost targets for the year by $500,000. When questioned about it, she stated that the excess cost was because of the support costs allocated to the department, over which Jean has no control. Which of the following statements support her claim? a. The manufacturing department requires 4,000 labor hours to meet the target output. During the year, the department used 5,000 labor hours. b. The support department costs were allocated based on the square feet area of the production premises. The floor area of the manufacturing facility is 10,500 square feet. c. The support costs were allocated based on the number of employees. The manufacturing department was assigned 40 employees, but Jean requested for 20 additional employees. d. The raw material costs increased by 1.5 times during the year. Alternative raw materials were in short supply and could not be procured.
b
Sometimes a single manufacturing process generates multiple outputs. For example, the distillation of crude oil leads to the production of Gasoline and Kerosene. In this scenario, Gasoline and Kerosene are called __________. a. additive products b. joint products c. composite products d. crude products
b
Support departments are normally accounted for as a(n) __________. a. investment center b. cost center c. profit center d. None of the above
b
The costs incurred when a single manufacturing process generates multiple outputs are called ________. a. flyaway costs b. joint costs c. imputed costs d. legacy costs
b
When the ________ method is used to apply overhead to products, support department costs are simply combined with all other overhead costs. a. multiple production department rates b. single plantwide rate c. activity-based costing d. None of the above
b
Which of the four common methods for allocating joint costs is likely to use gallons as a measure of the products at the split off point? a. The market value at split-off method b. The physical units method c. The weighted average method d. The net realizable value method
b