Which of the following terms describes the systematic evaluation of all aspects of
research and development, design of products and processes, production, marketing,
distribution, and customer service?
A.quality engineering.
B.incremental engineering.
C.systems engineering.
D.value engineering.
Gem Systems
Gem Systems uses an activity-based costing system. The company has gathered the
following information concerning various cost pools and activity drivers;
The following data was collected and is specific to Job 150.
Refer to Gem Systems. What is the amount of electricity cost allocated to Job 150?
A.$ 1,000
B.$15,000
C.$ 3,000
D.$ 5,000
Which of the following is true about the use of the balanced scorecard to measure
performance?
A.It measures performance by integrating financial and nonfinancial measures.
B.It promotes achieving the company’s goals and objectives.
C.It uses different sorts of measures such as financial, internal business process,
learning and growth, and customer.
D.All of the answers are correct.
The Bat Division of Baseball Company has just revised its actual cost data for 2008.
Bat Division transfers goods to the Sport Division. Sport Division can buy the same
goods in the open market for $122 each. Bat’s new cost data are as follows:
Current production is 200,000 units, and the Bat Division has a capacity of 300,000
units.
Required:
a. What is the lowest price the Bat Division should charge for the internal transfers of
its goods?
b. What is the highest price the Sport Division should pay for the units?
c. Give the primary reason why the Bat Division should reduce its price.
Activity-based reporting. The Carter Corporation manufactures oxygen tanks
for hospitals. Information regarding resources for the month of March follows.
In addition, $22,000 was spent on 700 quality inspections with a cost driver rate of $30,
and $8,000 was spent on 200 customer-service cost driver units with a cost driver rate
of $35. Sales for March were $350,000. Management has requested the following
statements be prepared.
Required:
a. Prepare a traditional income statement.
b. Prepare an activity-based income statement.
c. Write a short report explaining why the activity-based income statement provides
better information to managers.
One of the weaknesses of the various cost estimation methods is a simplifying
assumption that cost behavior patterns are
A.linear within the relevant range.
B.curvilinear within the relevant range.
C.semi-variable within the relevant range.
D.semi-fixed within the relevant range.
Which of the following qualitative factors favors the buy choice in a make or buy
decision?
A.Maintaining a long-run relationship with suppliers
B.The utilization of idle capacity
C.Quality control is critical.
D.All of the answers are correct.
Inventory management. Here are facts about inventory costs for Winston Wines, a
retailer:
Required:
Prepare a table like Exhibit 7.14 in the text. Find the costs of ordering and carrying
inventory for each of the following number of annual orders: 20 orders, 30 orders, 40
orders.
(Winston Wines; inventory management.)
Which of the following is not a major group responsible for variances in organizations?
A.Marketing
B.Consulting
C.Administration
D.Production
Which of the following are key characteristic(s) of divisional incentive compensation
plans?
A.cash bonuses and profit sharing for short-term performance.
B.deferred compensation for long-term incentive.
C.special awards for particular actions or extraordinary performance.
D.All of the answers are correct.
Activity-based costing raises numerous specific questions that managers can address to
improve which of the following?
A.Productivity and quality.
B.Price and efficiency.
C.Efficiency only.
D.Productivity only.
Operation costing is a hybrid of which of the following two costing methods?
A.batch costing and backflush costing.
B.job costing and process costing.
C.job costing and backflush costing.
D.process costing and backflush costing.
Marshall Manufacturing Co.
Marshall Manufacturing Co. uses an activity-based costing system. The company has
gathered the following information concerning various cost pools and activity drivers;
The following data was collected and is specific to Item No. 824.
Refer to Marshall Manufacturing Co. What would be the unit cost for the materials
handling activity at Marshall Manufacturing Co.?
A.$ 4.00
B.$80.00
C.$ 2.00
D.$ 1.00
Fred’s Fine Roasted Coffee
Fred’s Fine Roasted Coffee reports the following data for April 2010 where 500,000
pounds of roasted gourmet coffee beans were actually produced (note: standard costs do
not allow for any wastage),
Refer to Fred’s Fine Roasted Coffee. Calculate the direct labor price variance.
A.$48,000 F
B.$20,000 F
C.$68,000 F
D.$28,000 F