COST ACCOUNTING - ACTIVITY BASED COSTING

the activity based costing system is one that

• traces costs to activities and then to products

• traces products to activities and then to resources

• traces cost to resources and then to activities

• traces activities to costs and then to resources

Which costing system asigns costs within multiple cost pools to products using multiple cost drivers?

• ABC system

• Varible costing

• absorption costing

• all of the above

ABC system would probably provide the greatest benefits for organizations that use

• Process costing

• Job order costing

• standard costing

• absorption costing

_________ is the product or department for which costs are accumulated or measured

• cost driver

• cost object

• cost accounting

• activity based costing

Direct labor cost is an example of

• facility level activity

• batch level activity

• Unit Level Activity

• Product line activity

The last step in ABC System is

• assign manufacturing overhead cost for each cost pool to products

• Identify major activities involved in the manufacture of specific products

• Identify the cost driver that has a strong correlation to the costs accumulated in the cost pool

• Compute the factory overhead rate

The following are benefits of ABC except

• better management decisions

• more control over manufacturing overhead costs

• elimination of all arbitrary cost allocations

• more accurate cost data

Which of the following types of characteristics tend to cause too little overhead costs to be charged to the product using traditional cost allocations

• a relatively low small products

• a relative low volume products

• a relative high volume products

• a and b

ABC System cannot be used by

• Manufacturers

• Book publishers

• Hotel

• None of the choices

Which of the following is not a broad,, cost classification category typically used in ABC System

• Facility level activity

• Batch level activity

• Unit level activity

• Product line activity