chapter 7 managerial accounting

A costing system that first assigns costs to activities and then to products is a. activity-based costing. b. job-order costing. c. activity-based management. d. nonunit-level costing. e. volume based costing.

a. activity-based costing

Using only unit-based activity drivers to assign nonunit-related overhead costs can cause a. product diversity. b. distorted product costs. c. efficiency. d. activity sharing. e. None of these.

b. distorted product costs.

In an activity dictionary, types of resources consumed is an example of a(n) a. quality. b. activity attribute. c. activity sharing. d. allocation.

b. activity attribute

A(n) ____ ratio measures the proportion of an activity consumed by a product. a. usage b. consumption c. quality d. efficiency e. production

b. consumption

A list of activities accompanied by information that describes each activity is an activity ____. a. note b. dictionary c. manifesto d. journal e. diary

b. dictionary

____ is present whenever products have different consumption ratios for different overhead activities. a. Environmental costs b. Activity sharing c. Product diversity d. Activity inputs e. Control costs

c. Product diversity

Setups, material handling, and inspection are all possible examples of a. product diversity. b. unit level overhead activities. c. nonunit-level overhead activities. d. sustainable development. e. None of these.

c. nonunit-level overhead activities

Activity drivers can be classified as either ____ or ____. a. right; wrong b. exact; inexact c. inputs; outputs d. unit-level; nonunit-level

d. unit-level; nonunit-level

____ are assigned using direct tracing and resource drivers. a. Profits b. Products c. Resources d. Costs e. Materials

d. costs

_____ costs in many firms represent a much higher percentage of product costs than direct labor. a. Control b. Failure c. Nonvalue-added d. Overhead e. Appraisal

d. overhead

Interviews and surveys are used to identify a. velocity. b. control costs. c. costs. d. cycle time. e. activities.

e. activities

____ can help a company become more competitive by providing more accurate cost data. a. Unit-based costing b. Production costing c. Kaizen costing d. Volume-based costing e. Activity-based costing

e. activity based costing

A volume-based costing system emphasizes direct tracing and driver tracing. true or false

false

A work distribution matrix is derived from an interview or a written survey. true or false

true

Activity drivers should be classified as either unit-level or nonunit-level. true or false

true

An activity dictionary lists the activities in an organization along with some critical activity attributes. true or false

true

An activity-based costing system first assigns costs to activities and then to cost objects. true or false

true

Product diversity means that products consume overhead activities in systematically different proportions. true or false

true

Unit-level activities are performed each time a unit is produced. true or false

true