1. The Purchasing Department buys materials and supplies in a factory. The Janitorial Department cleans the factory. The Assembly Department puts together the products made in the factory. The Painting Department paints the products made in the factory. If the Purchasing Department performs a significant amount of work on behalf of the Janitorial Department, and the Janitorial Department performs a significant amount of work on behalf of the Purchasing Department, then which method would you recommend that the company use to allocate support department costs to the producing departments?

Direct Method

Reciprocal Method

Sequential Method

None of the above

2. A factory sells boxes of Red Apples, Green Apples, and Yellow Apples. After receiving the apples from local farmers, the factory makes sure the apples are washed, sorted by color and boxed. At split-off, the Red Apple Boxes, Green Apple Boxes, and Yellow Apple Boxes all have different selling prices. Based on what you know about this company, which method would you recommend that the company use to allocate joint costs to these joint products?

Constant Gross Margin Percentage Method

Physical Units Method

Net Realizable Value Method

Sales-Value-at-Split-Off Method

3. Companies can easily combine _________________ and _________________ to compute a single product cost amount.

Absorption Costing; Variable Costing

Actual Costing; Standard Costing

Traditional Costing; Activity-Based Costing

Normal Costing; Traditional Costing

4. Companies can easily combine _________________ and _________________ to compute a single product cost amount.

Absorption Costing; Job-Order Costing

Actual Costing; Standard Costing

Traditional Costing; Activity-Based Costing

Normal Costing; Actual Costing

5. Companies can easily combine _________________ and _________________ to compute a single product cost amount.

Absorption Costing; Variable Costing

Process Costing; Standard Costing

Traditional Costing; Activity-Based Costing

Normal Costing; Actual Costing