• Distinguish the single-rate method from the dual-rate method.
  • A single rate method is one that...
  • A dual rate method is one that...
  • How are these alike and different?
  • What are the advantages or disadvantages to these?

• What is the difference between budgeted and actual rates?
• What are the advantages or disadvantages to these?
• There is a third approach: allocate fixed costs based on practical capacity.
  • What is practical capacity?
  • How is this different from budgeted and actual rates?

• Allocate multiple support-department costs using the direct method, the step-down method, and the reciprocal method.
  • Explain the purpose of Allocating multiple support department costs...
  • Compare and contrast the three methods
  • For each of the three methods,
    • Summarize the approach
    • List the steps to apply
    • What are the pros and cons of the method

• Allocate common costs using the stand-alone method and the incremental method.
  • Explain the purpose of Allocating common costs...
    • How is this different then 3 above?
  • Compare and contrast the two methods
  • For each of the two methods,
    • Summarize the approach
    • List the steps to apply
    • What are the pros and cons of the method

• Explain the importance of explicit agreement between contracting parties when the reimbursement amount is based on costs incurred.
• Understand how bundling of products causes revenue-allocation issues and the methods managers use to allocate revenues.

Identify the splitoff point in a joint-cost situation and distinguish joint products from byproducts.

• Define and compare
  • Joint costs
  • Splitoff point
  • Separable costs
  • Main product
  • Joint products
  • Byproducts

• Explain why joint costs are allocated to individual products.
  • The text lists several purposes. Be prepared to discuss one or more of them

• Allocate joint costs using four methods.
  • Discuss the purpose of allocating joint costs.
  • Compare and contrast this with Job Costing, ABC Costing, and allocations covered in chapters 15 and 16.
  • Compare and contrast the four methods of allocating joint costs
  • For each of the four methods,
    • Summarize the approach
    • List the steps to apply
    • What are the pros and cons of the method

• Identify situations when the sales value at splitoff method is preferred when allocating joint costs.
  • Define and discuss the sales value at splitoff
  • Why and when is this method preferrable?
  • What are the cons to this method?