First: Activity-based management seeks to eliminate waste by allocating costs to products that waste resources. Second: In activity-based costing, nonmanufacturing costs as well as manufacturing costs may be assigned to products. a. Only the first statement is true b. Only the second statement is true c. Both statements are true d. Both statements are false

First: Activity-based management seeks to eliminate waste by allocating costs to products that waste resources. Second: In activity-based costing, nonmanufacturing costs as well as manufacturing costs may be assigned to products. a. Only the first statement is true b. Only the second statement is true c. Both statements are true d. Both statements are false

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter6: Activity-based, Variable, And Absorption Costing

Section: Chapter Questions

Problem 12MC: Which statement is correct? A. Activity-based cost systems are less costly than traditional cost...

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Which statement is correct? A. Activity-based cost systems are less costly than traditional cost systems. B. Activity-based cost systems are easier to implement than traditional cost systems. C. Activity-based cost systems are more accurate than traditional cost systems. D. Activity-based cost systems provide the same data as traditional cost systems.
Which of the following statements is true? * A. The traditional approach to costing uses many different cost drivers. B. Costs that are indirect to products are by definition traceable to directly to products. C. Costs that are indirect to products are traceable to some activity. D. All of the above statements are true.
TRUE OR FALSE A cost function is useful only in an activity-based costing system.
Which of the following statements are false regarding Activity-Based Costing? Select one: A. Non-manufacturing costs are not necessary to include when calculating the profitability of each product. B. Costs are allocated based on a pre-determined overhead rate. C. Transitioning from traditional costing methods to Activity-Based Costing can be complicated and costly. D. Activity-Based Costing follows the same basic calculation methods as traditional costing approaches. E. None of the above OO O
Which of the following statements regarding activity-based costing (ABC) is false? A. ABC is not an appropriate tool for analysing non-manufacturing costs. B. ABC can be used to analyse the profitability of customers. C. ABC evolved as a response to problems with traditional costing systems. D. ABC can be used to measure the cost of cost objects.
Absorption costing is:A. a good way to value inventories for the balance sheet.B. used for external reporting purposes.C. less useful than variable costing for management decision making. D. A and B is correct E. A, B and C is correct
Which of the following is false about activity-based costing? Implementing an activity-based costing system is more costly than implementing a traditional cost allocation system. In ABC, the assumption is that activities use resources or cause costs. An activity-based costing system relies only on volume measures such as direct labor hours to allocate all overhead costs to products. A traditional cost allocation system and an activity-based costing system are used to estimate the profitability of products.
"Activity-based costing does a better job of allocating both direct and indirect cost than traditional methods do.” Is this statement true, false, or uncertain?
Activity-based costing does a better job of allocating both direct and indirect cost than traditional methods do.” Is this statement true, false, or uncertain? Explain providing specific evidence to support your view.
Which of the following statements is true of ABC systems? A) ABC systems are time-driven cost systems. B) ABC systems classify some direct costs as indirect costs and some indirect costs as direct costs. C) ABC systems provide valuable information to managers beyond accurate product costs. D) ABC systems assume all costs are variable costs.
Accounting When refining a costing system, the desire to identify direct costs, is primarily drive by the fact that: a.Direct Costs are cheaper to identify cross out b.Direct costs are traceable cross out c.Direct costs are included in manufacturing overhead cross out d.Direct costs are not included in cost of good sold
Marginal Costing is a technique of _____. a. Cost Reduction b. Cost Evaluation c. Cost Control d. Cost Measurement