Question

1. Which of the following is the step in which materials, labor, and overhead are detailed?

Group of answer choices

A) allocating the costs to the units transferred out and the units partially completed

B) determining the equivalent units of production

C) determining the units to which costs are assigned

D) determining the cost per equivalent units

2. Activity-based costing is preferable in a system:

Group of answer choices

A) with multiple, diverse products

B) where management needs to support an increase in sales price

C) when multiple products have similar product volumes and costs

D) with a large direct labor cost as a percentage of the total product cost

3. Which of the following is a reason a company would implement activity-based costing?

Group of answer choices

A) They want to improve the data on which decisions are made.

B) A company only has one cost driver.

C) The additional data obtained through traditional allocation are not worth the cost.

D) The cost of record keeping is high.

4. Which is not a step in analyzing the cost driver for manufacturing overhead?

Group of answer choices

A) analyze the effect on manufacturing overhead

B) identify the cost

C) identify the correlation between the potential driver and manufacturing overhead

D) identify non-value-added costs

5.The most common budget is prepared for a ________.

Group of answer choices

A) month

B) week

C) quarter

D) year

Answer 1

Ans: Highlighted colours are the right answers.

1. Which of the following is the step in which materials, labor, and overhead are detailed?

Group of answer choices

A) allocating the costs to the units transferred out and the units partially completed

B) determining the equivalent units of production

C) determining the units to which costs are assigned

D) determining the cost per equivalent units

Explanation to right answer: Material, labour and overhead are detailed in determining the cost per euipvalent units. hence, Option D is the right answer.

2. Activity-based costing is preferable in a system:

Group of answer choices

A) with multiple, diverse products

B) where management needs to support an increase in sales price

C) when multiple products have similar product volumes and costs

D) with a large direct labor cost as a percentage of the total product cost

Explanation to right answer:

ABC costing : It is a method generally used to allocate the overhead costs of the product using activity rates differently for each activity. under Abc method, costs are collected according to the activites and these costs are ultimately absorved by different jobs, processes or product rationaly. Abc system is particularly appropiate for complicated businesses, having varity of products or similar product volumes and costs. Hence, Option C is the right answer.

3. Which of the following is a reason a company would implement activity-based costing?

Group of answer choices

A) They want to improve the data on which decisions are made.

B) A company only has one cost driver.

C) The additional data obtained through traditional allocation are not worth the cost.

D) The cost of record keeping is high.

Explanation to right answer: ABC costing provides better information and detailed data analysis on the products based on their activites about their profitability, so it became more helpful for the management to take managerial decisions. Hence the Option A is right.

4. Which is not a step in analyzing the cost driver for manufacturing overhead?

Group of answer choices

A) analyze the effect on manufacturing overhead

B) identify the cost

C) identify the correlation between the potential driver and manufacturing overhead

D) identify non-value-added costs

Explanation to right answer: Identifying non-value added costs is not a step in analyzing the cost driver for manufacturing overhead. hence Option D is right.

5.The most common budget is prepared for a ________.

Group of answer choices

A) month

B) week

C) quarter

D) year

Explanation to right answer: mostly the Budgets are prepared for A Year. Hence, Option D is right