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230) The cost of product liability claims is an example of a(n) ________ cost. A) appraisal B) internal failure C) external failure D) prevention 231) The lost profits from lost customers are an example of what type of cost? A) Prevention costs B) Internal failure costs C) External failure costs D) Appraisal costs 232) The costs of.
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71) All of the following describe an ABC system except A) ABC systems may only be used by service companies. B) ABC systems can create more accurate product costs. C) ABC systems are more complex and costly than traditional costing systems. D) ABC systems are used in both manufacturing and nonmanufacturing companies. 72) Which of.
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110) Hummingbird Manufacturing manufactures small parts and uses an activity-based costing system. Activity Est. Indirect Activity Costs Allocation base Cost allocation rate Materials $75,000   Material moves $3.00/move Assembling $255,000   Direct labor hours $10.00/dir. labor hour Packaging $90,000   # of finished units $1.00/finished unit The following parts were produced in October with the following information: Part # Produced Materials Costs # Moves Dir. Labor Hrs. A 2,250 $3,000 900 250 B 4,000 $6,500 1,700 325 C 4,750 $9,000.
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147) Duquesne Incorporated recently implemented an activity-based costing system. Total results from all products manufactured in the current year are: Activity cost poolTotal costTotal activity Assembly$7,5001,500machine-hours Packaging$3,150450number of orders Quality control inspections$900200number of inspections Duquesne manufactures sprinkler heads for commercial applications. Annual production and sales of one of its heads, is 2,300. The following relates.
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89) The production equivalent unit report summarizes all costs. 90) If a company has no ending work in process inventory, it does not need to use the 5-step process costing procedure to determine the cost of making one unit. 91) If a company has ending work in process inventory it must use.
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11) Refined costing systems can be used to allocate any indirect costs to any cost objects. 12) Merchandising and service companies, as well as governmental agencies, can use refined cost allocation systems to provide their managers with better cost information. 13) A plantwide overhead rate is calculated by dividing the.
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129) At Sunrise Corporation, direct materials are added at the beginning of the process and conversions costs are uniformly applied. Other details include: WIP beginning (50% for conversion) 19,200 units Units started 120,500 units Units completed and transferred out 116,700 units WIP ending (60% for conversion) 23,000 units Beginning WIP direct materials $35,000 Beginning WIP conversion costs $22,500 Costs of materials added $384,100 Costs.
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1) Process costing is typically used for businesses that make unique goods in relatively small amounts. 2) Cost for direct materials, direct labor and manufacturing overhead are assigned to each job. 3) A separate work in process inventory account is maintained for each process. 4) Unique or custom-made goods use a process costing.
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119) For which of the following do we prepare calculations for equivalent units? A) Both direct labor and manufacturing overhead B) Both direct materials and conversion costs C) Both direct labor and direct materials D) Neither direct materials nor conversion costs 120) What are the ending inventory equivalent units for materials if 15,500 units are.
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120) Beartowne Enterprises uses an activity-based costing system to assign costs in its auto-parts division. Activity Est. Indirect Activity Costs Allocation base Cost allocation rate Materials $60,000   Material moves $5.00/move Assembling $175,000   Direct labor hours $5.00/dir. labor hour Packaging $70,000   # of finished units $2.50/finished unit The following units were produced in December with the following information: Part # # Produced Materials Costs # Moves Dir. Labor Hrs. Part 001 1,250 .
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169) A tennis ball maker gives us its data for the year: WIP inventory, beginning 0 units Units started 8,500 units Units completed and transferred out 5,600 units WIP inventory, ending 2,900 units Direct materials $14,778 Direct labor $6,500 Manufacturing overhead $5,611 Units in ending WIP inventory were 90% complete for materials and 60% complete for conversion costs. On December 31,.
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61) If conversion costs are added evenly throughout the production process, and the units have made it 50% of the way through the production process, then the percentage completion for conversion costs is A) 0%. B) 50%. C) 100%. D) none of the above. 62) A company uses a process system. The number of equivalent.
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41) In a mass-production environment, direct labor is usually a relatively small component of the total manufacturing costs. 42) Companies that use automated production processes often condense the three manufacturing costs into two categories: Direct materials and Conversion costs. 43) Companies that use automated production processes often condense the three manufacturing costs.
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146) Bohemian Manufacturing manufactures several different products and uses an activity-based costing system. Information from its system for the year for all products follows: The annual production and sales of one of its products, the Sizzler, are 1,500 units. The following data relate to the production and sales of Sizzlers in.
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150) ABC tends to increase the unit cost of low-volume products and decrease the unit cost of high-volume products. 151) Traditional cost systems with a single-allocation base tend to overcost high-volume products and undercost low-volume products as compared to activity-based costing systems. 152) There will be little benefit to using an activity-based.
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1) When overhead is allocated to every product using the same manufacturing overhead rate, this rate is called the departmental overhead rate. 2) With increased competition, managers need more accurate estimates of product costs in order to set prices and to identify the most profitable products. 3) The plantwide overhead cost.
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220) All of the following statements regarding total quality management are true except A) TQM emphasizes educating, training, and cross training employees to increase and broaden their skills. B) TQM is a formal effort to improve quality throughout an organization's value chain. C) TQM extends horizontally across business functions in the value chain. D).
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101) Potter & Weasley Company had the following activities, estimated indirect activity costs, and allocation bases: Activities Indirect Activity Costs Allocation Base Account inquiry (hours) $86,400 2,700 Account billing (lines) $56,000 32,000 Account verification (accounts) $38,250 25,500 Correspondence (letters) $80,000 10,000 Potter & Weasley uses activity based costing. The above activities are used by Departments P and Q as follows: Department P Department Q Account inquiry (hours) 400 800 Account billing (lines) 10,000 4,000 Account verification.
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240) Which term below best describes the quality cost category for "cost to re-inspect reworked blenders"? A) Prevention costs B) Internal failure costs C) Appraisal costs D) External failure costs 241) Which term below best describes the quality cost category for "cost of warranty repairs on juicers"? A) Prevention costs B) Appraisal costs C) External failure costs D).
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40) Bobke Technologies manufactures three types of computers for a well known national brand. The three types are: laptops, desktops, and tablets. Currently, Bobke uses a single plant-wide overhead rate to allocate its $1,667,250 of annual manufacturing overhead. Of this amount, $562,000 is associated with laptops, $492,000 is associated with.
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31) In process costing, manufacturing costs are usually combined into two categories: direct materials and conversion costs. 32) Conversion costs are generally added evenly throughout a process. 33) Equivalent units express the amount of work done during a period in terms of partially completed units. 34) Equivalent units should be computed separately for.
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51) Machine set-up would be considered a batch-level cost. 52) Product-level activities and costs are incurred for a particular product, regardless of the number of units or batches of the product produced. 53) The cost to research and develop, design and market new models would be considered a product-level cost..
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181) Direct materials are added at the beginning of the process and conversions costs are uniformly applied. Other details include: WIP beginning (50% for conversion) 28,400 units Units started 124,000 units Units completed and transferred out 107,000 units WIP ending (50% for conversion) 45,400 units Beginning WIP direct materials $53,200 Beginning WIP conversion costs $19,600 Costs of materials added $442,100 Costs of conversion added $304,650 Required: a.What.
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21) Process costing is most likely used in which of the following industries? A) Chemicals B) Aircraft C) Construction D) Printing 22) Process costing is most likely used in which of the following industries? A) Pharmaceuticals B) Health Care C) Shipbuilding D) Construction 23) Process costing would likely be used by which of the following? A) Clear Channel Advertising B) PIP.
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81) Kramer Company manufactures coffee tables and uses an activity-based costing system to allocate all manufacturing conversion costs. Each coffee tables consists of 20 separate parts totaling $240 in direct materials, and requires 5.0 hours of machine time to produce. Additional information follows: Activity Allocation Base Cost Allocation Rate Materials handling Number of parts $2.00 per.
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161) The storage of raw materials is considered a value-added activity. 162) Inspection is considered a non-value-added activity. 163) Non-value-added activities can be described as activities for which the customer is willing to pay. 164) Waste activities is another name for non-value-added activities. 165) Non-value added activities are activities that neither enhance the.
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149) During a period, 38,200 units were completed and 4,200 units were in ending WIP inventory. Ending WIP was 75% complete for direct materials and 50% complete for conversion costs. What are the equivalent units for conversion costs? A) 40,300 B) 41,350 C) 42,400 D) 21,200 150) During a period, 38,200 units were completed and.
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91) Telecom uses activity-based costing to allocate all manufacturing conversion costs. Telecom produces cellular telephones; each phone has $40.00 of direct materials, includes 30 parts and requires 3 hours of machine time. Additional information follows: Activity Allocation Base Cost Allocation Rate Materials handling Number of parts $0.50 per part Machining Machine hours $14.00 per machine hour Assembling Number of parts $1.00 per.
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41) As compared to traditional volume-based costing using a single plantwide overhead rate, activity-based costing (ABC) is a more refined costing system that reduces cost distortion. 42) Traditional costing systems are generally more accurate than ABC costing. 43) It is easier to allocate indirect costs to the products that actually caused those.
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140) Vintage Fun reproduces old-fashioned style roller skates and skateboards. The annual production and sales of roller skates is 950 units, while 1,750 skateboards are produced and sold. The company has traditionally used direct labor hours to allocate its overhead to products. Roller skates require 2.5 direct labor hours per.
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149) Columbia Corporation manufactures two products: Tricycles and Wagons. The annual production and sales of Tricycles is 2,200 units, while 1,750 units of Wagons are produced and sold. The company has traditionally used direct labor hours to allocate its overhead to products. Tricycles require 2 direct labor hours per unit,.
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180) Lean companies typically arrange production activities into self-contained cells. 181) Waste can be reduced by implementing shorter setup times. 182) Lean companies typically cross-train employees to perform more than one task. 183) One key element of lean production is to produce large batches. 184) A lean company typically strives to lengthen.
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139) At Onyx Incorporated, direct materials are added at the beginning of the process and conversions costs are uniformly applied. Other details include: WIP beginning (70% for conversion) 15,200 units Units started 150,000 units Units completed and transferred out 120,000 units WIP ending (50% for conversion) 45,200 units Beginning WIP direct materials $52,500 Beginning WIP conversion costs $25,200 Costs of materials added $443,100 Costs.
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83) The following information is provided by Mel Company: WIP inventory, January 1 0 units Units started 23,000 units Units completed and transferred out 18,000 units WIP inventory, December 31 5,000 units Direct materials $22,400 Direct labor $16,500 Manufacturing overhead $27,200 The units in ending WIP inventory were 90% complete for materials and 25% complete for conversion costs. Required: a.  What are.
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31) James Industries uses departmental overhead rates to allocate its manufacturing overhead to jobs. The company has two departments: Assembly and Sanding. The Assembly Department uses a departmental overhead rate of $35 per machine hour, while the Sanding Department uses a departmental overhead rate of $20 per direct labor hour..
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159) The following information is provided by Galloway Company: WIP inventory, January 1 0 units Units started 22,000 units Units completed and transferred out 9,000 units WIP inventory, December 31 13,000 units Direct materials $26,500 Direct labor $12,500 Manufacturing overhead $12,000 The units were 80% complete for materials and 30% complete for conversion costs. How much are the total costs for.
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21) If a company uses departmental overhead allocation rates, then the amount of manufacturing overhead allocated to the job is equal to the plantwide overhead rate multiplied by the actual use of the cost allocation base. 22) The allocation base selected for each department should be the cost driver of.
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81) The following information is provided by Bynes Company: WIP inventory, January 1 0 units Units started 23,000 units Units completed and transferred out 20,000 units WIP inventory, December 31 3,000 units Direct materials $22,400 Direct labor $16,500 Manufacturing overhead $27,200 The units in ending WIP inventory were 85% complete for materials and 25% complete for conversion costs. Required: a.What are the.
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200) External failure costs occur when poor-quality goods or services are not detected until after delivery to customers. 201) Product testing is an appraisal cost. 202) An example of an appraisal cost is the cost of automating the production process. 203) The cost of training employees would be classified as a prevention.
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39) High Rise Display Company manufactures display cases to be sold to retail stores. The cases come in three sizes: Large, Medium, and Small. Currently, High Rise Display Company uses a single plant-wide overhead rate to allocate its $3,357,800 of annual manufacturing overhead. Of this amount, $820,000 is associated with.
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190) Which of the following is true about lean thinking? A) Customer orders drive the production process. B) Inventory levels are maintained at high levels. C) Raw materials are purchased in large quantities. D) Finished goods are produced ahead of customers' orders to protect against running out of finished goods inventory. 191) Which of.
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130) Howard, Fine, & Howard is an advertising agency. The firm uses an activity-based costing system to allocate overhead costs to its services. Information about the firm's activity cost pool rates follows: Stooge Company was a client of Howard, Fine, & Howard. Recently, 7 administrative assistant hours, 3 new ad campaigns,.
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