1.Which statement is true regarding the sales method of accounting for byproducts?

a.This method makes a journal entry to reduce the cost of the main product(s)

b.This method is the preferred method because of the matching principle

c.Revenues of the byproduct can be recorded in the income statement as revenue when produced

d. No value is attached to the byproduct inventory

2.The Bonawitz Corporation has a central copying facility. The copying facility has only two users, the Marketing Department and the Operations Department. The following data apply to the coming budget year:

Budgeted costs of operating the copying facility

for 200,000 to 300,000 copies:

Fixed costs per year $30,000

Variable costs 3 cents (.03) per copy

Budgeted long-run usage in copies per year:

Marketing Department 60,000 copies

Operations Department 190,000 copies

Actual usage for the year by the Marketing Department was 40,000 copies and by the Operations Department was 180,000 copies. Actual cost per copy was 3.5 cents (.035).

If a dual-rate cost allocation method is used, what amount of copying facility costs will be allocated to the Operations Department? Use the application methodology that best measures the responsible use of the copying facility's services..

a.$29,100

b.$29,450

c.$28,500

d.$28,200

3.The collection of information on costs and their drivers, gathered through observations and interviews, from departments within an organization is known as

a.the quantitative analysis method.

b.the account analysis method.

c.the conference method.

d. the industrial-engineering method.

4.To discourage excessive use of a support department, management might

a.Not allocate any costs of the support department

b.Allocate costs based on user department usage

c.Allocate a fixed amount to each department regardless of use

d.Expense fixed costs of support departments directly to the income statement

4.Pam's Stables used two different predictor variables (trainer hours and number of horses) in two different equations to evaluate the cost of training horses. The most recent results of the two regressions are as follows:

Trainer's hours:

Variable Coefficient Standard Error t-Value

Constant 913.32 2.093 4.44

Predictor Variable 20.90 2.844 3.50

r2= 0.56

Number of horses:

Variable Coefficient Standard Error t-Value

Constant 4764.5 0.812 4.61

Predictor Variable

864.98

0.294

3.40

r2= 0.83

What is the estimated total cost for the coming year if 16,000 trainer hours are incurred and the stable has 400 horses to be trained, based on the best cost driver?

a.$81,273.32

b.$314,413.32

c.$335,313.32

d.$350,756.50