True or False: Advancements in technology give companies the ability to more accurately track costs, and thus turn costs that were originally classified as "direct" into "indirect" True False Question 23 (1 point) For the month of June, a company reports a "production-volume variance" of "$50,000 unfavourable" re. it's fixed costs. This variance indicates the company underspent it's budgeted fixed costs by $50,000 the company overspent it's budgeted fixed costs by $50,000 the company wasted an "opportunity" with an order of magnitude equal to $50,000, by not producing the number of units that its fixed costs/assets gave them the capability to produce the company wasted an opportunity" with an order of magnitude equal to $50,000, by not producing the number of units that its fixed costs/assets gave them the capability to produce, and BOTH the quantity used and and price per unit of fixed costs were higher than budgeted Question 24 (1 point) You are the management accountant (in a large engineering firm) assigned to set up an accounting system to accurately track a "soon-to-be-started" individual project's cost. The firm has multiple projects being undertaken at any one time. In this endeavor, you should FIRST identify as many "indirect cost allocation bases" as possible (associated with the project in question) identify as many "indirect cost pools" as possible (associated with the project in question) O identify as many "indirect" costs as possible (associated with the project in question identify/develop as many "direct" costs as possible (associated with the project in question Question 25 (1 point) A sign that an ABC costing system may pay dividends is O your company has a large percentage of indirect costs allocated using one cost pool your manufacturing process involves a large number of batch activities you make a variety of products - some relatively simple to manufacture - some relatively complicated to manufacture experienced front line managers constantly question the accuracy of indirect cost allocation to the various products all of the listed answers apply Question 26 (1 point) Your company manufactures wooden chairs and is thinking of expanding into making wooden tables. You've never made tables before and need to develop unit costs for this product in order to set a price. Thus you undertake time trials to determine how many minutes it will take your labour force to make a table (i.e. you actually time your workers while they make prototype tables). This procedure is an example of the following "Cost Estimation Method Time Trial Method Quantitative Analysis Method O Industrial Engineering Method O Account Analysis Method Question 27 (1 point) True or false: All else being equal, by working to increase production capacity of currently owned fixed assets, managers will be able to lower their unit cost of production, provided "cost/benefit" guidelines are followed. True False Question 28 (1 point) True or False: Most business's typically monitor only financial (i.e. strictly measured in $'s) variance performance measures due to Cost-Benefit considerations. True False Question 29 (1 point) True or False: "Value added" cost ITEMS can typically be eliminated without affecting customers' perception of quality, since these ITEMS will typically not be of major concern to customers. True False Question 30 (1 point) True or False: A"cost allocation base" is a systematic way to link "indirect costs" to a "cost object" - in other words, the "cost allocation base" is an estimation of what DRIVES indirect costs. True False
