Sample Test Essay

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Sample Test Questions: CH 5, 17 Name___________________________________ MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) The MOST likely example of a batch-level cost is: 1) _______ A) utility costs B) product-designing costs C) machine repairs D) setup costs 2) Factories producing a more varied and complex mix of products have higher costs than factories producing only a narrow range of products because: 2) _______ A) they require more direct laborers B) they require more engineers C) more variations and complexities require more activities D) they buy more robotics Answer the following questions using the information below: King Corporation has two departments, Small and Large. Central costs could be allocated to the two departments in various ways. Small Department Large Department Square footage 6,000 18,000 Number of employees 1,120 480 Sales $400,000 $2,000,000 3) If total rent expense of $120,000 is allocated on the basis of square footage, the amount allocated to the Small Department would be: 3) _______ A) $20,000 B) $84,000 C) $30,000 D) $90,000 Answer the following questions using the information below: Mayan Potters manufactures two sizes of ceramic paperweights, regular and jumbo. The following information applies to their expectations for the planning period: Cost Pool Overhead Costs Activity-cost driver Materials handling $ 45,000 90,000 orders Machine maintenance $300,000 15,000 maintenance hours Setups $270,000 45,000 setups Inspections $105,000 21,000 inspections Total support costs $720,000 Production Estimates Production units: Regular = 8,000,000 units Jumbo = 16,000,000 units

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