66. Fenway Telcom has three divisions, commercial, retail, and consumer, that share the
common costs of the company’s computer server network. The annual common costs are
$2,400,000. You have been provided with the following information for the upcoming year:
Fenway Telcom uses the single rate method and allocates common costs based on the time on
the network. What is the total computer server network cost allocated to the Retail Division?
67. Fenway Telcom has three divisions, commercial, retail, and consumer, that share the
common costs of the company’s computer server network. The annual common costs are
$2,400,000. You have been provided with the following information for the upcoming year:
The cost accountant determined $1,700,000 of the server network’s costs were fixed and should
be allocated based on the number of connections. The remaining costs should be allocated based
on the time on the network. What is the total server network costs allocated to the Commercial
Division, assuming the company uses dual-rates to allocate common costs?
68. Fenway Telcom has three divisions, commercial, retail, and consumer, that share the
common costs of the company’s computer server network. The annual common costs are
$2,400,000. You have been provided with the following information for the upcoming year:
The cost accountant determined $1,700,000 of the server network’s costs were fixed and should
be allocated based on the number of connections. The remaining costs should be allocated based
on the time on the network. What is total server network costs allocated to the Retail Division,
assuming the company uses dual-rates to allocate common costs?
69. Fenway Telcom has three divisions, commercial, retail, and consumer, that share the
common costs of the company’s computer server network. The annual common costs are
$2,400,000. You have been provided with the following information for the upcoming year:
The cost accountant determined $1,700,000 of the server network’s costs were fixed and should
be allocated based on the number of connections. The remaining costs should be allocated based
on the time on the network. What is total server network costs allocated to the Consumer Division,
assuming the company uses dual-rates to allocate common costs?
70. The Document Creation Center (DCC) for Alegis Corp. provides photocopying and
document services for three departments in the St. Paul office. The following budget has been
prepared for the year.
If DCC uses a dual rate for allocating its costs based on usage, how much cost will be allocated to
the Software Development Department?
71. The Document Creation Center (DCC) for Alegis Corp. provides photocopying and
document services for three departments in the St. Paul office. The following budget has been
prepared for the year.
If DCC uses a dual rate for allocating its costs based on usage, how much cost will be allocated to
the Training Department?
72. The Document Creation Center (DCC) for Alegis Corp. provides photocopying and
document services for three departments in the St. Paul office. The following budget has been
prepared for the year.
If DCC uses a dual rate for allocating its costs based on usage, how much cost will be allocated to
the Management Department?
73. The Document Creation Center (DCC) for Alegis Corp. provides photocopying and
document services for three departments in the St. Paul office. The following budget has been
prepared for the year.
If DCC uses a dual-rate for allocating its costs, how much cost will be allocated to the
Management Department, assuming the Management Department actually made 2,100,000
copies during the year?
74. The Document Creation Center (DCC) for Alegis Corp. provides photocopying and
document services for three departments in the St. Paul office. The following budget has been
prepared for the year.
If DCC uses a dual-rate for allocating its costs, how much cost will be allocated to the
Management Department, assuming the Management Department actually made 2,950,000
copies during the year?
75. The Document Creation Center (DCC) for Alegis Corp. provides photocopying and
document services for three departments in the St. Paul office. The following budget has been
prepared for the year.
If DCC uses a dual-rate for allocating its costs, how much cost will be allocated to the Training
Department, assuming the Training Department actually made 3,250,000 copies during the year?
76. The Document Creation Center (DCC) for Alegis Corp. provides photocopying and
document services for three departments in the St. Paul office. The following budget has been
prepared for the year.
If DCC uses a dual-rate for allocating its costs, how much cost will be allocated to the Training
Department, assuming the Training Department actually made 2,770,000 copies during the year?
77. The Document Creation Center (DCC) for Alegis Corp. provides photocopying and
document services for three departments in the St. Paul office. The following budget has been
prepared for the year.
If DCC uses a dual-rate for allocating its costs, how much cost will be allocated to the Software
Development Department, assuming the Software Development Department actually made
1,160,000 copies during the year?
78. The Document Creation Center (DCC) for Alegis Corp. provides photocopying and
document services for three departments in the St. Paul office. The following budget has been
prepared for the year.
If DCC uses a dual-rate for allocating its costs, how much cost will be allocated to the Software
Development Department, assuming the Software Development Department actually made
1,780,000 copies during the year?
79. In responsibility accounting, a center’s performance is measured by those costs which are
controllable. Controllable costs are best described as including: (CMA adapted)
80. Rockford Manufacturing Corporation uses a responsibility accounting system in its
operations. Which one of the following items is
least
likely to appear in a performance report for a
manager of one of Rockford’s assembly lines? (CMA adapted)
81. Responsibility accounting defines an operating center that is responsible for revenue and
costs as a(n): (CMA adapted)
82. When comparing performance report information for top management with that of lower–
level management: (CMA adapted)
83. The least complex segment or area of responsibility for which costs are allocated is a(n):
(CMA adapted)
84. Which one of the following will
not
occur in an organization that gives managers
throughout the organization maximum freedom to make decisions? (CMA adapted)
85. Which one of the following firms is likely to experience dysfunctional motivation on the
part of its managers due to its allocation methods? (CMA adapted)
86. Which of the following three statements are correct?
I. A profit center has control over both cost and revenue.
II. An investment center has control over invested funds, but not over costs and revenue.
III. A cost center has no control over sales.
87. The purpose of the Data Processing Department of Falena Corporation is to assist the
various departments of the corporation with their information needs free of charge. The Data
Processing Department would best be evaluated as a:
88. Dunkle Corporation’s Maintenance Department provides services to the company’s two
operating divisions – the Paints Division and the Stains Division. The variable costs of the
Maintenance Department are budgeted based on the number of cases produced by the operating
departments. The fixed costs of the Maintenance Department are budgeted based on the number
of cases produced by the operating departments during the peak period. Data appear below:
For performance evaluation purposes, how much Maintenance Department cost should be
charged to the Paints Division at the end of the year?
89. The fixed costs of Baxter Company’s personnel department are allocated to operating
departments on the basis of direct labor-hours. The following data have been provided:
The fixed costs of the personnel department are budgeted at $56,000 per year and are incurred in
order to support long-run average requirements. How much of this fixed cost should be charged to
Operating Department X at the end of the year for performance evaluation purposes?