| B | Direct labor. | C | Variable overhead. | D | Variable overhead. | 3. | On the Schedule of Cost of Goods Manufactured, the final Cost of Goods Manufactured figure represents: | A | the amount of cost charged to Work in Process during the period.
CHAPTER 4 JOB COSTING TRUE/FALSE 1. Direct costs are allocated to the cost object using a cost-allocation method. Answer: False Difficulty: 1 Objective: 1 Terms to Learn: cost-allocation base Indirect costs are allocated to the cost object using a cost-allocation method. 2. Quality control costs may be a direct cost of the Manufacturing Department, but an indirect cost of an individual job.
* (1) Duplicate paychecks might be issued. * (2) The wrong hourly rate could be used to calculate gross pay. * (3) Employees might be paid for hours they did not work. * (4) Payroll checks might not be distributed to the appropriate employees. * c. The purpose of segregating the duties of hiring personnel and distributing payroll checks is to separate the * (1) human resource function from the controllership function.
In the purpose of stock valuation and profit measurement, we can divide the costing system into direct material, direct manufacturing labor and manufacturing overhead cost. * Direct material: is all material directly involved to produce the product (unless used in negligible amounts and/ or having negligible cost). Direct materials cost are the costs of material that are used in making and selling a product. * Direct manufacturing labor: is all employee or worker who are directly involved in the production of goods and service (http://www.businessdictionary.com/definition/direct-labor.html). Direct manufacturing labor cost is the specific costs of workforce used to make a product or provide service.
On the other hand, Mr. Abbots skepticism about ABC costing is also reasonable and understandable. ABC would take a lot of time and effort to be implemented, and moreover would involve inevitable significant expenses. A precise and accurate implementation and management of ABC costing would require a complex task involving across all of the organization including not only DGMs and accounting department but also production, marketing and many others. Considering the size of the company ABC costing would also
Fair value from business combination and net asset. 5. Overvaluation of the purchasing cost paid by acquirer. 6. Overpayment on acquisition.
Assessment of quality is affected by one’s position in the value chain. Answer: T AACSB: Reflective Thinking Skills 8. Improved quality of design leads to lower costs and improved quality of conformance leads to higher prices. Answer: F AACSB: Analytic Skills 9. In general, employee empowerment has been viewed as an effective practice for customer-driven organizations that embrace total quality.
Costing analysis method: Breaking each product cost into three elements: materials, direct labor and benefits, and overhead. The plant’s financial personnel provided the detailed data. 3. The overhead cost is applied to the cost of product as a percent of direct labor dollar cost. (overhead rate: 1987 model year: 435%, 1990 model year: 563%) 4.
1.Cost-based pricing includes: Cost-plus pricing, which is simply a standard markup (predetermined figure or percentage) to the entire cost of producing the product. This method does not take into account fluctuating product demand or the prices of competitive offerings. Break-even analysis/target-profit pricing, which is
Financial accounting information is used for a.|investment decisions.| b.|regulatory measures.| c.|stewardship evaluation.| d.|all of these.| ANS: D PTS: 1 DIF: Easy OBJ: 1-1 NAT: AACSB Communication 6. Which of the following is NOT part of the financial accounting information system? a.|filing reports with the SEC| b.|reporting a large contingent liability to current and potential shareholders| c.|determining the future cashflows of a proposed flexible manufacturing system| d.|preparing GAAP financial statements| ANS: C PTS: 1 DIF: Meduim OBJ: 1-1 NAT: AACSB Reflective 7. Which of the following does NOT describe cost management system? a.|evaluation of segments or products within the firm| b.|emphasis on the future| c.|externally focused| d.|focus on effective use of