44. Predetermined rates for allocating indirect costs to products are computed as

follows:

A. Estimated indirect cost/Estimated volume of the allocation base

B. Estimated volume of the allocation base/Estimated indirect cost

C. Estimated indirect cost/Actual volume of the allocation base

D. Actual indirect cost/Estimated volume of the allocation base

45. Activity-based costing:

A. uses multiple activities.

B. is another name for just-in- time.

C. always gives the same product cost as traditional costing.

D. is another term for traditional costing.

46. Activity-based costing provides management with strategic information. This

information can be used by companies to:

A. identify potential customers.

B. identify potential quality problems.

C. develop a competitive advantage.

D. No other answer is correct.

47. Activity-based costing provides management with strategic information. This

information can be used by companies to:

A. develop a competitive advantage.

B. make substantial price cuts.

C. increase market share.

D. All of the other answers are correct.

48. Establishing a lean production philosophy typically:

A. increases costs.

B. reduces costs.

C. reduces quality.

D. Two of the other answers are correct.

49. Variable costs and fixed costs can best be described by which of the following

when related to changing production levels?

A. Fixed costs stay constant per unit, but variable costs vary per unit.

B. Fixed costs vary per unit, but variable costs stay constant per unit.

C. Variable costs stay constant in total amount but vary in unit cost.

D. Fixed costs vary in total amount but stay constant in unit cost.