5 Written Questions
5 Matching Questions
- organization sustaining activities
- Variable costing
- batch level activities
- product level activities
- a activities that are performed each time a batch of goods is handled or processed, regardless of how many units are in the batch. The amount of resource consumed depends on the number of batches run rather than on the number of units in the batch.
- b activities that relate to specific products that must be carried out regardless of how many units are produced and sold or batches run.
- c activities that are carried out regardless of which customers are served, which products are produced, how many batches are run, or how many units are made.
- d any part or activity of an organization about which managers seek cost, revenue, or profit data.
- e A costing method that includes only variable manufacturing costs: Direct materials, direct labor, and variable manufacturing overhead in unit product costs.
5 Multiple Choice Questions
- A fixed cost that supports more than one business segment, but is not traceable in whole or in part to any one of the business segments.
- a segment's contribution margin less its traceable fixed costs. It represents the margin available after a segment has covered all of its own traceable costs.
- the process by which overhead costs are assigned to activity cost pools in an activity based costing system.
- a simple count of the number of times an activity occurs.
- a costing method base on activities that is designed to provide managers with cost information for strategies and other decisions that potentially affect capacity and therefore fixed as well as variable costs.
5 True/False Questions
unit level activities → activities that are performed each time a unit is produced.
activity based management (ABM) → a management approach that focuses on managing activities as a way of eliminating waste and reducing delays and defects.
traceable fixed cost → A fixed cost that supports more than one business segment, but is not traceable in whole or in part to any one of the business segments.
activity → any part or activity of an organization about which managers seek cost, revenue, or profit data.
activity cost pool → an allocation base in an activity based costing system; ideally, a measure of the amount of activity that drives the costs in an activity cost pool.