Which of the following costs are relatively easier to allocate using volumebased cost systems and drivers?

a. Setup costs

b. Factory rent costs

c. Direct material costs

d. Product design costs

38. Which of the following is an advantage of activitybased costing systems over volumebased cost systems?

1. Activity based costing is easier to implement in companies that have relatively higher proportions of nonunitlevel costs.
2. Activity based costing is cheaper to implement than volumebased cost systems.
3. Activity based costing provides more accurate cost information than volumebased cost systems.
4. Activity based costing provides allocates more than their fair share of overhead costs to lowvolume products than volumebased cost systems.

39. Fixed cost per unit ________ with increase in production.

a. decreases

b. increases

c. fluctuates

d. remains constant

40. Which of the following is most likely to be classified as a fixed cost?

a. Office supplies

b. Wages of part time workers

c. Materials cost

d. Depreciation on a factory machine

41. An R square of 1.0 indicates:

a. that the independent variables are insignificant.

b. that the slope of the cost equation will be 1.

c. a perfect correlation between the independent and dependent variables.

d. the standard error in the data is equal to 1%.

42. The aftertax benefit of a taxable cash receipt can be found by:

a. subtracting the additional income tax to be paid from the beforetax receipt.

b. multiplying the additional income tax to be paid with the beforetax receipt.

c. adding the additional income tax to be paid to the beforetax receipt.

d. dividing the additional income tax to be paid by the beforetax receipt.