- Writing software for a new computer game at a software company that produces and sells computer games would be considered a...
product-level activity
- All of the following are examples of batch-level activities except:
Clerical activity associated with processing purchase orders to produce an order for a standard product.
Purchase order processing.
Setting up equipment.
Worker recreational facilities.
Worker recreational facilities.
- Bangayan Company uses activity-based costing to determine the costs of its two products: A and B. The estimated total cost and expected activity for one of the company's three activity cost pools are as follows.
Expected Activity
Estimated Cost Product A Product B
$15,000 480 360
The activity rate under the activity-based costing system for this activity is roughly...
$17.86
- Chibucos Company has two products: A and B. The annual production and sales level of Product A is 9,994 units. The annual production and sales level of Product B is 16,906. The company uses activity-costing and has prepared the following analysis showing the estimated total cost and expected activity for each of its three activity cost pools.
Activity Estimated Expected Total
Cost Overhead Activity
Pool Cost Product A Product B
#1 $33,700 1,450 860 2,310
#2 $47,200 380 1,340 1,720
#3 $190,800 780 6,210 6,990
The activity rate under the activity-based costing system for Activity 3 is roughly...
$27.30
- Ekcer Company uses activity-based costing to compute product costs for external reports. The company has three activity cost pools and applies overhead using predetermined overhead rates for each activity cost pool. Estimated costs totaled $29,880 and expected activity equals 1,800 for this activity cost pool. Actual activity for the current year was 1,490. The amount of overhead applied for this activity during the year was roughly...
$24,734
- A company that provides photocopying services has an activity-based costing system with three activity cost pools—making photocopies, serving customers, and setting up machines. The activity rates are $0.03 per photocopy, $2.15 per customer, and $0.80 per machine-setup. If a customer requires set-ups on two different machines and makes 245 copies in total, how much cost would be assigned by the activity-based costing system for this transaction?
$11.10
- When there are batch-level or product-level costs, in comparison to a traditional cost system, an activity-based costing system ordinarily will shift costs from...
High-volume to low-volume products
- Product margin is a function of the...
product's sales and the direct and indirect costs that the product causes.
- All of the following statements are correct except:
a) the simplest absorption costing systems assign manufacturing overhead costs to products using a single factory-wide predetermined overhead rate.
b) activity-based costing assign manufacturing overhead costs to products using a predetermined overhead rate for each activity cost pool.
c) activity-based costing can also be used to develop product costs for external financial reports.
d) activity-based costing information is used for decision-making.
c) activity-based costing can also be used to develop product costs for external financial reports.
- All of the following statements are incorrect except:
a) Instead of arbitrarily assigning various indirect costs to low-volume products, an activity-based costing system more accurately assigns these costs to the company's high-volume and low-volume products.
b) Instead of arbitrarily assigning various indirect costs to high-volume products, an activity-based costing system more accurately assigns these costs to the company's high-volume and low-volume products.
c) Instead of arbitrarily assigning various indirect costs to low-volume products, a traditional costing system more accurately assigns these costs to the company's high-volume and low-volume products.
d) Instead of arbitrarily assigning various indirect costs to high-volume products, a traditional costing system more accurately assigns these costs to the company's high-volume and low-volume products.
b) Instead of arbitrarily assigning various indirect costs to high-volume products, an activity-based costing system more accurately assigns these costs to the company's high-volume and low-volume products.
