15. Suppose a company adopts job costing using the normal costing approach. Then, measuring the manufacturing costs per unit Requires information on budgeted manufacturing direct cost rates Requires information on the total actual quantity of the cost allocation base Requires information on budgeted manufacturing indirect cost rates Requires information on actual manufacturing indirect cost rates To determine the cost of goods sold (COGS) for nancial reporting purposes at a manufacturing company, the following formula should be used: COGS = Cost ofgoods manufactured Beginning inventory COGS = Beginning inventory + Cost ofgoods manufactured Ending inventory COGS = Ending inventory + Beginning inventory Cost of goods manufactured COGS = Beginning inventory Cost ofgoods manufactured Ending inventory Reassessment Management Accounting Master in Management Section 4 Suppose that Ligt, inc. produces only two products: A and B. If the new costing system used by the company reveals that product A was undercosted by its previous costing system, then managers at Ligt can conclude that: The previous system traced too many direct costs to products A and B The new costing system is an improvement over the previous costing system Product B was overcosted by the previous costing system ProductA was unprotable under the previous costing system In general, if inventory increases during an accounting period, both variable costing and absorption costing will show losses variable costing will report less operating income than absorption costing variable costing and absorption costing will report the same operating income absorption costing will report less operating income than variable costing When allocating the indirect cost of support departments to operating departments The support departments will typically be overcosted, and the operating departments will typically be underco sted The reciprocal method results in higher estimates of total indirect costs compared to the direct method The direct method leads to less accurate estimates of the resources consumed by operating departments compared to the reciprocal method Total direct costs increase by the amount of support department overhead costs traced to operating departments