Question

In: Accounting

i) ‘Activity based costing is clearly a superior system to conventional product costing techniques. Hence, all...

i) ‘Activity based costing is clearly a superior system to conventional product costing techniques. Hence, all organisations should adopt activity based costing’. Do you agree? Explain! (Maximum 200 words)

ii) Discuss the differences that exist between the three types of service entities. (Maximum 200 words)

iii) ‘The human reactions to the budgeting process can have a considerable influence on an organisation’s overall effectiveness.’ Discuss two ways in which human reactions to budgets can have a negative impact on organisational performance. (Maximum 200 words)

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Activity based costing is clearly a superior system to conventional product costing techniques. Hence, all organisations...
Activity based costing is clearly a superior system to conventional product costing techniques. Hence, all organisations should adopt activity based costing’. Do you agree? Explain!
Activity-Based Costing and Product Cost Distortion Handbrain Inc. is considering a change to activity-based product costing....
Activity-Based Costing and Product Cost Distortion Handbrain Inc. is considering a change to activity-based product costing. The company produces two products, cell phones and tablet PCs, in a single production department. The production department is estimated to require 4,000 direct labor hours. The total indirect labor is budgeted to be $462,400. Time records from indirect labor employees revealed that they spent 40% of their time setting up production runs and 60% of their time supporting actual production. The following information...
Activity-Based Costing and Product Cost Distortion Handbrain Inc. is considering a change to activity-based product costing....
Activity-Based Costing and Product Cost Distortion Handbrain Inc. is considering a change to activity-based product costing. The company produces two products, cell phones and tablet PCs, in a single production department. The production department is estimated to require 4,000 direct labor hours. The total indirect labor is budgeted to be $462,400. Time records from indirect labor employees revealed that they spent 40% of their time setting up production runs and 60% of their time supporting actual production. The following information...
Activity-Based Costing and Product Cost Distortion Handbrain Inc. is considering a change to activity-based product costing....
Activity-Based Costing and Product Cost Distortion Handbrain Inc. is considering a change to activity-based product costing. The company produces two products, cell phones and tablet PCs, in a single production department. The production department is estimated to require 4,000 direct labor hours. The total indirect labor is budgeted to be $462,400. Time records from indirect labor employees revealed that they spent 40% of their time setting up production runs and 60% of their time supporting actual production. The following information...
Activity-Based Costing and Product Cost Distortion Handbrain Inc. is considering a change to activity-based product costing....
Activity-Based Costing and Product Cost Distortion Handbrain Inc. is considering a change to activity-based product costing. The company produces two products, cell phones and tablet PCs, in a single production department. The production department is estimated to require 4,000 direct labor hours. The total indirect labor is budgeted to be $462,400. Time records from indirect labor employees revealed that they spent 40% of their time setting up production runs and 60% of their time supporting actual production. The following information...
In an environment where activity–based costing is necessary and appropriate, is the relevance of conventional CVP...
In an environment where activity–based costing is necessary and appropriate, is the relevance of conventional CVP analysis enhanced or diminished? Explain.
Doede Corporation uses activity-based costing to compute product margins. In the first stage, the activity-based costing...
Doede Corporation uses activity-based costing to compute product margins. In the first stage, the activity-based costing system allocates two overhead accounts--equipment depreciation and supervisory expense--to three activity cost pools--Machining, Order Filling, and Other--based on resource consumption. Data to perform these allocations appear below: Overhead costs: Equipment depreciation $ 82,000 Supervisory expense $ 12,100 Distribution of Resource Consumption Across Activity Cost Pools: Activity Cost Pools Machining Order Filling Other Equipment depreciation 0.60 0.30 0.10 Supervisory expense 0.60 0.20 0.20 In the...
Doede Corporation uses activity-based costing to compute product margins. In the first stage, the activity-based costing...
Doede Corporation uses activity-based costing to compute product margins. In the first stage, the activity-based costing system allocates two overhead accounts--equipment depreciation and supervisory expense--to three activity cost pools--Machining, Order Filling, and Other--based on resource consumption. Data to perform these allocations appear below: Overhead costs: Equipment depreciation $ 30,000 Supervisory expense $ 14,800 Distribution of Resource Consumption Across Activity Cost Pools: Activity Cost Pools Machining Order Filling Other Equipment depreciation 0.50 0.40 0.10 Supervisory expense 0.50 0.30 0.20 In the...
Dodo Inc., uses activity-based costing to determine product margins. In the first stage, the activity-based costing...
Dodo Inc., uses activity-based costing to determine product margins. In the first stage, the activity-based costing system allocates two overhead accounts--equipment depreciation and supervisory expense--to three activity cost pools--Machining, Order Filling, and Other--based on resource consumption. Data pertinnent to perform these allocations appears below: Overhead costs: Equipment depreciation $ 107,000 Supervisory expense $ 9,900 Distribution of Resource Consumption Across Activity Cost Pools: Activity Cost Pools Machining Order Filling Other Equipment depreciation 0.60 0.30 0.10 Supervisory expense 0.60 0.20 0.20 In...
Doede Corporation uses activity-based costing to compute product margins. In the first stage, the activity-based costing...
Doede Corporation uses activity-based costing to compute product margins. In the first stage, the activity-based costing system allocates two overhead accounts--equipment depreciation and supervisory expense--to three activity cost pools--Machining, Order Filling, and Other--based on resource consumption. Data to perform these allocations appear below: Overhead costs: Equipment depreciation $ 103,000 Supervisory expense $ 13,100 Distribution of Resource Consumption Across Activity Cost Pools: Activity Cost Pools Machining Order Filling Other Equipment depreciation 0.60 0.20 0.20 Supervisory expense 0.60 0.10 0.30 In the...
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