ASAP QUIZ!!!!!!!
Which statement is FALSE in regards to the treatment of direct material costs under an activity-based costing system?
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Direct material costs are handled in the same manner under both an ABC system and a traditional cost system. |
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Direct material costs are treated as a product cost under an ABC system. |
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Direct material costs are not included in the product cost under an ABC system. |
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Direct material costs go directly into the cost of the product under an ABC system. |
Which of the following statements in true?
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Both traditional (one PDOHR) and Activity-Based Costing systems are used to accumulate total product costs. |
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An Activity-Based Costing system is easier to use but less effective than a traditional system (one PDOHR). |
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A traditional costing system (one PDOHR) can only be used when applying a process manufacturing system. |
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Only Activity-Based Costing can be used when applying a job-order costing system. |
Under an Activity-Based Costing (ABC) system, indirect manufacturing costs are first categorized into which of the following?
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none of the above |
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batch orders |
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activity pools. |
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job numbers |
Assume a company has the following information:
Activity Pools: Total Cost Activity Driver
Machine Setups $15,000 100 setups
Material Moves $22,500 225 material moves
Machine Operations $14,000 175 machine hours
Product X used the following quantity of activity drivers to produce 100 units of final product:
25 setups, 40 material moves and 75 machine hours
What is the cost allocation rate used for applying machine setup costs to product X?
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$294 per machine hour |
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$80 per machine hour |
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$100 per unit produced |
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$150 per setup |
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Activity Pools: Total Cost Activity Driver
Machine Setups $15,000 100 setups
Material Moves $22,500 225 material moves
Machine Operations $14,000 175 machine hours
Product X used the following quantity of activity drivers to produce 100 units of final product:
25 setups, 40 material moves and 75 machine hours
What is the total indirect manufacturing cost per unit for product X based on an ABC system?
$150 per unit
$137.50 per unit
$9.82 per unit
$80 per unit
