Answered: 1. Select two decisions-one common to a…

1. Select two decisions-one common to a manufacturer and the other common to a service organization-and give two examples of irrelevant future costs for each decision. Why are they irrelevant.

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter8: Tactical Decision-making And Relevant Analysis

Section: Chapter Questions

Problem 8MCQ: In a make-or-buy decision, a. the company must choose between expanding or dropping a product line....

See similar textbooks

Related questions

Q: Is

Q: Which one of the following statement is not correct? Group of answer choices -Opportunity costs are…

A: Managerial accounting is helpful in decision-making related to a product whether the product should…

Q: Which of the following is NOT a reason for companies to assign costs to products or services?

A: We know that objective of every business is to attain profitability Now, Profit for business is =…

Q: Which of the following may form the basis for the price a company (working at full capacity) should…

A: Opportunity costs : The benefit foregone by the company by employing the resource in other…

Q: “Sunk costs are considered by a manufacturer in decision making”. Do you agree? Explain.

A: "Sunk costs are considered by a manufacturer in decision making”. I do not agree with this…

Q: A Report a Problem O Revisit Choose the best option Question # 2 With reference to cost…

A: The costs in the production process can be classified on a different basis, for financial reporting…

Q: The amount of increase or decrease in cost that is expected from a particular course of action as…

A: Discretionary cost: A discretionary expense is a cost that a business or household can survive…

Q: What is the difference between whole units to be accounted for and whole units to be assigned costs?…

A: Difference between whole units to be accounted for and whole units to be assigned costs The whole…

Q: What is the danger in allocating common fixed costs among products or other segments of an…

A: The costs which are not allocated to any specific segment in the business organization are called…

Q: 15) Which of the following statements is true of ABC systems? A) ABC systems are time-driven cost…

A: Please find the answer to the above question below:

Q: Which of these costs is considered as the most important cost because if it is not met, an…

A: A company income statement will report the net income as the total revenue in excess of the total…

Q: Choose one correct answer by writing down the question number and the letter representing the answer…

A: Costs are classified as direct and indirect costs. Direct costs are a cost which is directly related…

Q: In a drop or continue decision, only the variable costs identified with a product are relevant in a…

A: The given statement is true.

Q: Demonstrate why expressing fixed costs on a per unit of activity basis is misleading and may result…

A: Companies can have two types of costs, fixed costs and variable costs, which together result in…

Q: Employee training is an example of discretionary fixed costs. Select one: True False

A: Hi student Since there are multiple questions, we will answer only first question.

Q: Which of the following statements is false? (You may select more than one answer.)a. Under some…

A: Sunk Cost: It is refers to the cost or the expense that had incurred in the past and can no longer…

Q: In Make or buy decision ,irrelevant costs are : Select one: a. manufacturing costs that will be…

A: Under make or buy decision, decision needs to taken whether we should manufacture the product or…

Q: t is known that a new fee will increase if the order made by the customer increases. Based on this…

A: Under ABC system, the costs are divided on the grounds of various types of cost drivers utilized.…

Q: In your own words, explain what differential costs mean. How are fixed costs and variable costs…

A: The cost can be classified on the basis of nature variable or fixed. The variable cost are directly…

Q: TRUE OR FALSE The general principle in determining the number of cost pools is that a separate cost…

A: Solution: The general principle in determining the number of cost pools is that a separate cost pool…

Q: Relevant of differential cost analysis takes all variable and fixed costs into account to analyze…

A: Differential cost analysis is the difference in cost for every alternative which helps in making the…

Q: he distinction between indirect and direct costs depends on: Select one: a. whether a cost differs…

A: Direct cost means the cost which can be related with the production of specific goods directly like…

Q: Costs that will differ between alternatives and influence the outcome of a decision are Select one:…

A: Sunk costs are expenses that have already been incurred but cannot be recovered. Sunk costs are…

Q: Fixed overhead costs that will continue regardless of a make-or-buy decision are ________ to the…

A: It is pertinent to note that fixed cost is the cost irrespective of the level of activity. Example…

Q: PLEASE ANSWER ALL 4. A cost management system will provide the means to develop a. The most…

A: Cost management is the system to manage the Cost ( Plan and control )

Q: Which one of the following statement is not correct? O Both fixed and variable costs influence…

A: The incorrect statement is "opoortunity costs are only considered when resources are limited" This…

Q: Briefly describe the treatment of Joint Costs when making a sell-or-process-further decision.

A: Dear student, as per Bartleby answering guidelines we can not answer more than one question if…

Q: In making short-term business decisions, what should you do? Use a traditional costing approach.…

A: Business decision refers to large part of conducting business is making decisions.

Q: What is the purpose of cost allocation in terms of economic decisions, motivation and justifying…

A: INTRODUCTION: Cost allocation is the process of identifying, accumulating, and assigning costs to…

Q: Companies benefit greatly from the use of a standard cost system, and the statement

A: This question deals with the use of a standard cost system, and the statemen

Q: Explain why service companies use different activity bases than manufacturing companies to classify…

A: Service companies are those companies which provide services to their clients such as…

Q: uantity order to reduce the overall cost is usually stated as EOQ. why it is related to one time…

A: Step 1 Economic order quantity (EOQ) is the ideal order quantity a company should purchase to…

Q: Costs that will differ between alternatives and influence the outcome of a decision ar Select one: O…

A: Relevant costs are the managerial costs that are incurred only to make specific business decisions.…

Q: Do you agree from the following statements- Explain in details with examples 1.Variable costs are…

A: IntroductionProduction cost may be defined as that type of expenses which occurs during the…

Q: Give the general formula for a mixed cost. What does each term represent?

A: Given: The general formula for the mixed cost is given.

Q: What is the danger in allocating common fixed costs among product lines or other segmentsof an…

A: Fixed cost: It can be defined as the cost that does not vary with an increase or decrease in the…

Q: Describe the differences in behavior of fixed costs, variable costs, semi-variable costs and step…

A: Fixed costs are fixed in nature, it doesn't vary with the change in units. The total fixed cost will…

Q: In Make or buy decision ,relevant costs are : Select one: a. manufacturing costs that will not be…

A: This question deal with the relevant costing concept and make or buy concept. As per the concept,…

Q: Consider the following statements concerning costs. 1. A committed cost cannot vary with the…

A: Committed costs are costs that are committed or fixed to be incurred in future period of time.…

Question

1. Select two decisions-one common to a manufacturer and the other common to a service organization-and give two examples of irrelevant future costs for each decision. Why are they irrelevant.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1 Introduction

VIEW

Step 2 Two Decision of Manufacturer

VIEW

Step 3 Two Decision of Service Organization

VIEW

Step 4 irrelevant future costs for each decision

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Explain why service companies use different activity bases than manufacturing companies to classify costs as fixed or variable.
In a make-or-buy decision, a. the company must choose between expanding or dropping a product line. b. the company must choose between accepting or rejecting a special order. c. the company would consider the purchase price of the externally provided good to be relevant. d. the company would consider all fixed overhead to be irrelevant. e. None of these.
Which one of the following statement is not correct? Group of answer choices -Opportunity costs are only considered when resources are limited. -Break-even analysis is used to determine how many units of a product or a service a business has to sell to cover all its costs. -Both fixed and variable costs influence short-term decision-making. -Short-term decision-making is all about analysing those costs that will change as a result of taking a particular action.
Which of the following best describes an "opportunity cost"? Expected future costs that differ among alternatives None of the items in this list of answers. Costs that were incurred in the past and cannot be changed The distribution of all products to be sold
Which of the following statements is true of ABC systems? A) ABC systems are time-driven cost systems. B) ABC systems classify some direct costs as indirect costs and some indirect costs as direct costs. C) ABC systems provide valuable information to managers beyond accurate product costs. D) ABC systems assume all costs are variable costs.
When pricing a product or service, managers must consider which of the following? a. Only period costs b. Only manufacturing costs c. Only variable costs d. All costs
1. Activity based costing is likely a more advantageous costing methold versus traditonal costing, to facilliate which of the following type of analysis? a) analysis of service organization cost b) analysis of channel profitablity c) analysis of long term profitablity d) analysis for reduction selling price of all products? 2. A ___ is any factor that causes a change in the cost of an activity. a) activity based cost b) cost pool c) cost driver d) standard 3. Which of the following is no a basic cost category for indirect cost? a) inventory financing cost b) Volume related cost c) Product batch cost d) activity based cost
Which of the following statements is true? (You may select more than one answer.)a. A common cost is one type of direct cost.b. A sunk cost is usually a differential cost.c. Opportunity costs are not usually recorded in the accounts of an organization.d. A particular cost may be direct or indirect depending on the cost object.
Is there a difference between relevant costs and incremental costs? Explain. Identify at least two (2) irrelevant costs in a make vs buy decision
When pricing a product or service, managers must consider which of the following? Only period costs Only manufacturing costs Only variable costs All costs
ABC Co.,is analyzing whether to expand operations by adding a new product line. Which of the following choices correctly identifies the costs that should be considered in this decision? none of the costs noted opportunity costs only sunk costs only
Explain cost concepts it is relevant for the company to be aware of in decision situations such as. offer costs, uninterrupted costs, come-and-go costs, reversible and irreversible costs, etc. How can the company include these in specific decision-making situations?