mcq on Activity Based Costing (ABC
Answers
Answer:
ABC.....................
Answer:
Activity based costing is considered to be a traditional costing method.
True
False
2.
Under ABC, indirect manufacturing costs are predominantly assigned on the basis of direct machine hours.
True
False
3.
Which of the following would not be included in a product's cost for inventory valuation for the financial statements?
Factory Supplies
Quality Control
Interest Expense
4.
Which would be the least favorable basis for allocating manufacturing overhead for a factory with automated equipment and a significant variation of services by its indirect labor?
ABC
Direct Labor Hours
Machine Hours
5.
Which would be the most favorable basis for allocating manufacturing overhead for a factory with automated equipment and a significant variation of services by its indirect labor?
ABC
Direct Labor Hours
Machine Hours
6.
Activity-based costing will provide greater accuracy when allocating costs than a manufacturer's machine hours when its products and customers are __________ diverse.
Less
More
7.
When using machine hours for allocating manufacturing overhead (instead of activity-based costing), a low-volume item requiring a significant amount of special handling will be assigned too __________ manufacturing overhead.
Little
Much
8.
The cost to set up production equipment is best allocated directly to products via machine hours.
True
False
9.
Setup cost is an example of a batch-level cost.
True
False
10.
Manufacturing costs are often organized in the general ledger by function and department. When applying activity-based costing, these manufacturing costs will be sorted by activities.
True
False