1] Which of the following is NOT an advantage of using the operating budget as a control device as compared to an ABC system: a] An ABC system will enable the company to identify activities which can be controlled, and areas where miscosting has occurred due to a lack of information b] An ABC system should accomplish more than just reducing costs. c] The benefits will always outweigh the costs of implementing an ABC system. d] Identifying activities provides more flexibility in that the company can control costs by controlling activities than simply limiting expenditures without any reasoning. 2] What are the two methods of accounting for byproducts? A a] production method and sales method b] production method and NRV method c] physicalmeasure method and NRV method d] sales method and grossmargin method 3] When considering replacing a piece of old equiment, which of the following is NOT a factor that may be relevant in making that decision? a] The reliability of the new equipment b] The original cost of the old equipment c] The reliability of the new equipment d] The operating cost of the new equipment 4) Assume a company sells crown moulding. The mouldings sell for $6.00. Management wants a target prot of 2096 ofsales. Tl'e sales are cu rrentlyI 200,000 units per yea r. What is tl'e target cost to achieve their target prot? a) $120 b) $4.00 c) $6.00 d) $4.30 5) Spoilage from a manufacturing process was discovered during an inspection of work in process. In a process-costing system, the cost of the spoilage would be added to the cost of the good units produced ifthe spoilage is: Normal Abnormal a) Yes Yes b) No No c) Yes No d) No Yes 6) For purposes ofalkmatingjoint costs tojoint products, the sales value at splito method could be used in which ofthe following situations: No costs beyond splito Costs beyond splito a) No No b) Yes No c) No Yes d) Yes Yes \f1G} The major cost management concept used in kaizen budgeting is that of a} eliminating inventories of every 1?.pr but materials. b} continuous improvement c} renements in the indirect cost categories for costing systems d} sensitivity analysis using computer-based nancial planning models