78. Activity-based costing for manufacturing operations is used to assign: A. Direct material and…

78.
Activity-based costing for manufacturing
operations is used to assign:
A.
Direct material and
direct labor costs to products.

B.
Direct labor and
manufacturing overhead costs to products.
C.
Manufacturing overhead
costs to products.
D.
Selling and general
administrative overhead costs to products.
E.
Selling and general
administrative overhead and manufacturing overhead costs to products.

79.
The use of activity-based costing is
most appropriate for:
A.
Firms that manufacture
multiple product lines.

B.
Firms that have very low
manufacturing overhead costs relative to other costs of production.
C.
Firms with high levels
of production activity.
D.
Firms that are labor
intensive.
E.
Firms that manufacture a
small number of product lines.

80.
Which of the following is a benefit of
activity-based costing?
A.
Reduced overhead costs.

B.
More accurate measures
of production volume.
C.
Facilitate better
product pricing decisions.
D.
Having fewer cost
drivers than volume-based costing systems.
E.
More streamlined
manufacturing processes.

81.
Which of the following is not
normally associated with activity-based costing?
A.
Activity cost pools.

B.
Multiple cost drivers.
C.
Reduction of
non-value-adding costs.
D.
High direct labor costs
relative to manufacturing overhead costs.
E.
Improved decision-making
and pricing.

82.
Which of the following is not
considered a benefit of activity-based costing?
A.
Decreased production
activity levels.

B.
Improved product pricing
decisions.
C.
A better understanding
of manufacturing overhead.
D.
More accurate unit cost
information.
E.
Improved strategic
decisions.

86. Which
of the following would be the most appropriate cost driver to allocate factory
electricity costs to products?

A.
Machinery depreciation
expense.
B.
Machinery maintenance
work orders.
C.
Machinery down-time.
D.
Machine hours.
E.
Machine productivity.

87. Which
of the following activity cost pools would most likely be allocated based on
the number of production runs?

A.
Machinery set-up costs.
B.
Raw materials
warehousing costs.
C.
Factory heating costs.
D.
Factory janitorial
costs.
E.
Indirect labor costs.

88.
Which of the following is most likely to
be the cost driver for the packaging and shipping activity?
A.
Number of setups.
B.
Number of components.
C.
Number of orders.
D.
Hours of testing.
E.
Number of production
runs.

89.
Activity-based costing
systems:

A.
Accumulate overhead
costs by departments.

B.
Are less complex and
therefore less costly than volume-based systems.
C.
Can be used in
manufacturing firms only.
D.
Have separate overhead
rates for each activity.
E.
Eliminate multiple-stage
cost allocation.

90.
All of the following statements
regarding activity-based costing systems are true except they:
A.
Can provide more
accurate product costs.

B.
Identify more costs as
indirect costs than do traditional volume-based systems.
C.
Are likely to be more
time-consuming than volume-based systems.
D.
Are used in both
manufacturing and non-manufacturing companies.
E.
Are likely to have more
overhead rates than volume-based systems.

 

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