Question 1. All of the following are true statements about activitybased costing except:

a. Activitybased costing is only used for manufacturing products.

b. Activitybased costing discourages the allocation of common fixed costs that are not consumed by any customer or product line.

c. Activitybased costing helps prevent crosssubsidization errors.

d. Activitybased costing breaks down fixed overhead costs into cost pools that relate to product or customer lines using activities other than volume of units.

Question 2. In order to prepare a capital expenditure budget, Ekin Shoes needs to determine the cash needed for production. Based on the following information, compute the cash budget for production for each of the next four quarters.

Ekin has five planned capital projects for this next year. (1) A new extra support sole manufacturing machine that will require payments of $6,000,000 each quarter this year. (2) A new manufacturing facility that will require payments of $73,000,000 for the first two quarters. (3) The purchase of a sport shoe line from a competitor for two payments of $23,000,000 in the first and third quarter. (4) Four cuttingedge artificial intelligence manufacturing robots for payments of $32,000,000 in the third quarter and 120% of the first payment in the fourth quarter. (5) New production monitoring equipment for the Wind George brand of shoe for $9,000,000 payments in the first, third, and fourth quarters.

Question 3. Which of the following is not a characteristic of successful budgeting?

a. The budget should be motivating for everyone in the organization.

b. The budget represents forecasts of external and internal factors.

c. The budget clearly connects to and supports the organization's strategy.

d. The budget should guide the strategy of the company.

Question 4. Frank's Frames makes custom silver picture frames engraved with names and significant dates, such as weddings or births. Although the frames can be partially completed in advance, all frames remain in the WorkinProcess Inventory account until the final engraving is completed. Frame AAA01 was completed in January. At the beginning of January, costs accumulated on the frame were direct materials of $40, direct labor of $60, and overhead of $16. Completing the frame required 1.5 hours of direct labor at $15 per hour. Overhead is applied at $4 per direct labor hour. What is the total cost on the job cost sheet for Job AAA01 at the end of January?