devry acct344 week 3 and week 5 quiz

1. Question
: (TCO 8) A predetermined
overhead rate is calculated using which formula?

Actual annual overhead / budgeted annual
driver level

Budgeted annual overhead / budgeted annual
driver level

Budgeted annual overhead / actual annual
driver level

Actual annual overhead / actual annual driver
level

2. Question : (TCO 8) All of the following are unit-based activity
drivers EXCEPT

number of setups.

machine hours.

number of units.

direct labor hours.

3. Question : (TCO 8) A department that is capital intensive most likely
would use a predetermined departmental overhead rate based on which activity
base?

Units of direct material used

Direct labor hours

Direct labor cost

Machine hours

4. Question : (TCO 8) Star Inc. uses a job-order costing system to
account for product costs.
The following information was provided for the current year.
Materials placed in production $160,000
Indirect labor
$50,000
Direct labor (10,000 hours) $180,000
Depreciation of factory building $80,000
Other factory overhead $130,000
Increase in work-in-process inventory $45,000
Factory overhead rate per direct labor hour $25
Which is the amount of under- or overapplied overhead for
Star Inc.?

$50,000 overapplied

$10,000 overapplied

$50,000 underapplied

$10,000 underapplied

5. Question : (TCO 8) Acme Company manufactures two products (anvils and
barrels).
Overhead costs ($84,000) have been divided into three cost
pools, which use the following activity drivers.
Product #
of Setups Machine Hours Packing Orders
Anvils 10 500 75
Barrels 10 2,000 175
Cost per Pool
$10,000 $60,000 $18,750

What is the allocation rate for barrels per machine hours
using activity-based costing?

$60,000

$24

$1,429

$30

6. Question : (TCO 8) Which is NOT a limitation of a plantwide overhead
rate?

Product diversity may consume overhead
activities under differing consumption ratios.
Overhead usage is not strictly linked to the
units produced because some products are more complex and diverse than others.
Predetermined rates using budgeted overhead
are usually the best estimate of the amount of overhead.
Overhead costs tend to be underallocated to
highly complex products.

:

7. Question : (TCO 8) The resources consumed by the activity in
producing its output are called

value-added activities.

activity outputs.

driver analyses.

activity inputs.

8. Question : (TCO 8) Which is NOT part of the cost dimension of the
activity-based management model?

Resources

Driver analysis

Activities

Cost objects

9. Question : (TCO 8) Which is an example of a non-value-added
manufacturing activity?

Assembly

Scheduling

Finishing

All of the above

10. Question : (TCO 8) The process that involves choosing among various
sets of activities that are caused by competing strategies is called

activity sharing.

activity selection.

activity elimination.

activity reduction.week 51. Question
: (TCO 7) A common cost occurs when only one product or service is
benefited. when different resources are used to produce
one output. when the same resource is used in the output
of two or more outputs. when a resource is used by two or more
companies. 2. Question : (TCO 7) Which would be the most appropriate base for
allocating the costs of the housekeeping department? Machine hours Direct labor hours Square feet Number of employees 3. Question : (TCO 7) The Ruling Company assigns plant administration
costs to the production departments based on thenumber of employees. Which would NOT be a good combination
of common costs with an activity driver? Personnel department costs based on number of
employees Purchasing department costs based on machine
hours Cafeteria costs based on meals served Warehouse costs based on the value of
materials stored 4. Question : (TCO 7) Joint costs are allocated because of financial reporting requirements. tax reporting requirements. IMA requirements. Both A and B 5. Question : (TCO 7) Which method allocates support department costs? Direct allocation method Reciprocal allocation method Sequential allocation method All of the above 6. Question : (TCO 7) Joint costs are separable. allocated on the basis of cause-and-effect
relationships. allocated arbitrarily. All of the above 7. Question : (TCO 7) Which method allocates joint production costs
based on the pounds of product produced? Sales-value-at-split-off method Physical units method Constant gross margin percentage method Replacement cost method 8. Question : (TCO 7) DeeDee Corporation manufactures the following
products in its factory. $400,000 of costs were incurred.Product Units
Produced Weight per Unit (lb) Selling Price per UnitA 2,500 10 $6B 5,000 8 $12C 7,500 6 $12D 10,000 4 $6How much joint cost would be allocated to Product A based on
the physical units method? $40,000 $460,000 $66,667 $400,000 9. Question : (TCO 7) Sally Corporation manufactures four products. The
following data were provided by the cost accountant for the current year.Product Units
Produced Sales Value at Split-OffJ 15,000 $10,000 K 9,000 $5,000 L 24,000 $6,000M 12,000 $9,000Total Joint Processing Costs
$24,000 Which is the amount of joint costs assigned to Product L
using the sales-value-at-split-off method? $9,600 $24,000 $1,600 $4,800 10. Question : (TCO 7) Lamb Inc. processes wool into four grades of yarn
as follows.Product Yards
Produced Sales Value at Split-OffMerino Wool 75,000 $56,250Wool Singles
200,000 $180,000Superwash Wool
100,000 $105,000Plied Wool
125,000 $127,500Total Joint Processing Costs
$300,000Which is the amount of joint costs assigned to Superwash
Wool using the constant gross margin percentage method? $300,000 $67,200 $37,800 $192,000