1.In which of the following industries could process costing be used?

Select one:

Paper mills

Petroleum refining

Food processing

All of the given answers

In a job costing system, when goods are completed costs are transferred as follows:

Select one:

Debit work in process, credit finished goods inventory

Debit work in process inventory, credit cost of goods sold

Debit cost of goods sold, credit work in process inventory

Debit finished goods inventory, credit work in process

Process costing for service entities is most likely to be used in situations where:

Select one:

customer contact is low.

the number of services produced is not very high.

the primary input is labour.

there is a high level of discretion in service production.

Which of the following are components of conversion costs?

Select one:

Indirect materials and manufacturing overhead.

Direct labour and indirect labour.

Direct labour and manufacturing overhead.

Direct labour and direct materials.

Lucky Klopp company starts work on 1000 physical units (Jurgens) and completes 75 per cent of conversion activity. The costs are $1500 for conversion and $5000 for direct material. What is the cost per equivalent unit for conversion?

Select one:

$1.00 per unit

$2.50 per unit

$1.50 per unit

$2.00 per unit

Rex Company Ltd had 4,000 units in work in process at 1 April. During April, 11,000 units were completed. At 30 April, 5,000 units remained in work in process. How many units were started during April?

Select one:

11,000

5,000

12,000

16,000

David Hasselhoff company starts work on 1000 physical units (Kitts) and completes 75 per cent of conversion activity. The costs are $1500 for conversion and $5000 for direct material, which is added at the beginning of the process. What is the cost per equivalent unit for direct material?

Select one:

$5.00 per unit

$6.67 per unit

$6.00 per unit

$10.00 per unit

A joint product with very little value relative to other joint products is termed a:

Select one:

negligible product.

scrap.

by-product.

accounted loss.

The support department cost allocation method that completely ignores reciprocal services between support departments is called the:

Select one:

direct method.

reciprocal method.

step-down method.

direct method AND step-down method.

The 'direct method' of allocating support department costs ignores the fact that:

Select one:

each department's cost is allocated only for the service consumed by it.

All of the given answers

some support departments provide services to other support departments.

costs need to be fully allocated to operating departments.

Which of the following statements is true?

Select one:

Activity-based costing cannot significantly improve product cost accuracy where there is significant product diversity.

Activity-based costing can significantly improve product cost accuracy where overhead costs are a large proportion of total costs.

In recent decades Direct Labour has increased as a proportion of total manufacturing costs in many manufacturing businesses.

Under traditional costing, product cost distortions will be highly significant if overhead costs are a small proportion of product cost.

Which of the following isNOTa factor that helped lead to the development of ABC:

Select one:

Increased proportions of non-manufacturing costs

Increased computing power to deal with complexity of ABC calculations.

Decreased levels of non-volume-driven manufacturing overhead costs.

Increased levels of competition, meaning it is more important to charge the 'correct' price.