Q: Is
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Q: argin, Operating Leverage, How to accept or reject “one time only special offers”, Irrelevant costs.
A: 1. Safety Margin: Marginal safety is an amount by which the actual sales exceed the break-even…
Q: In economic analysis we want to minimize the difference: (Benefits - Costs).
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A: " Since you have posted more than two questions and not specified which should be solved so we are…
Q: Marginal costing can provide useful information for decision-making. However, there are limitations…
A: There are various limitations of marginal costing few of them are stated below.
Q: Give an example of how a manager can decrease variable costs while increasing fixed costs?
A: Variable Cost: Variable costs are costs which are directly vary with the change in production.…
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A: Absorption costing is the method used by the managers to determine the cost connected with the…
Q: Why is absorption costing the method allowable for GAAP yet managers prefer variable costing
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Q: differential costs where you had to choose between two alternatives
A: Differential cost refers to the difference between the cost of two or more alternative options. It…
Q: “Increasing the number of indirect-cost pools is guaranteed to sizably increase the accuracy of…
A: Indirect cost pool refers to the accumulated cost that jointly benefits two or more costs…
Q: How lean production eliminate the difference between absorption and variable costing
A: Following is the answer to the given question
Q: CVP analysis using activity-based costs will tend to shift some costs from fixed to variable…
A: CVP Analysis: CVP analysis establishes the relation between cost, volume and profit of the…
Q: Please explain thoroughly the statement below. (True/false), how and why? "When expressed on a…
A: POINTS TO BE NOTED - ** Fixed cost will remain constant irrespective of change in the level of…
Q: What is the primary disadvantage of basing the costplus pricing formula on absorption cost?
A: Definition: Cost plus-pricing approach: The pricing approach used by the companies to set the target…
Q: Is activity-based costing always beneficial to an organization? in what situations would itb…
A: Activity based costing is a system of costing in which allocated on the basis of activity done .it…
Q: Under absorption costing, how is it possible to increase net operating income without increasing…
A: Format of Income Statement under Absorption Costing
Q: When constrained by a limiting resource, managers often seek to produce those products which have:…
A: if a manager constrained by limiting resource, he can be to produce those products which have the…
Q: When a traditional, volume-based costing system is used, which of the following products is most…
A: Traditional costing is the allocation of factory overhead to products based on the volume of…
Q: Which of the following is not a step st driver rate by the volume of cost w to reduce the costs of…
A: Explanation: Activity based costing is a costing technique where production is split into different…
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A: Cost accounting is the one that is used to calculate the production cost per unit or in total a…
Q: It known that variable costing should be used for pricing purposes. What is the benefit of using…
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Q: Give an example of how, under absorption costing, operating income could fall even though the unit…
A: Definition: Absorption Costing: The absorption costing is a method used to allocate the fixed…
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A: The cost can be classified on the basis of nature variable or fixed. The variable cost are directly…
Q: A technique used to split mixed costs into fixed and variable costs is called Select one: a. High…
A: The correct option is b. Behavior analysis method
Q: Absorption costing is more compatible with cost-volume-profit analysis than is variable costing.…
A: Variable costing simply covers the variable costs actually incurred in production, but not any of…
Q: When constrained by a limiting resource, managers often seek to produce those products which have:…
A: When constrained by some budget or limited sources managers often try to make products which lie in…
Q: The potential benefit of one alternative that is lost by choosing another is known as a. An…
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Q: From the standpoint of cost control, why is the FIFO method superior to the weighted-averagemethod?…
A: FIFO method is First in First out method in which inventory which is purchased first will be sold…
Q: Give an example of how a manager can increase variable costs while decreasing fixed costs?
A: Fixed costs refers to those which do not change according to the change in units of productions.…
Q: Give an example how a manager can increase variable cost while decreasing fixed costs
A: Cost behavior: Cost behavior is the relationship between cost and activity and it is relevant to the…
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A: Solution: Target costing is reversal of Cost plus model. This is because under target costing cost…
Q: All of the following can be used to achieve low costs EXCEPT: Availability of low-cost resources…
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Q: In order to draw a basic break-even chart, which of the following information would you not require?…
A: The break even sales are the sales where business earns no profit no loss during the period. The…
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Q: Accepting a special order will improve overall net operating income if the revenue from the special…
A: Variable costs are the costs which change with change in output. Sunk costs are the costs which are…
Q: Give an example how manager can decrease variable cost while increasing fixed cost
A: Cost behavior: Cost behavior is the relationship between cost and activity and it is relevant to 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: Which of the following statements is not false of costing systems? A. Activity-based costing…
A: Introduction: Traditional costing is the more simplest method which typically delivers less accuracy…
Q: Explain why using cost as a transfer price is inappropri-ate when the center producing the product…
A: Profit Center: A profit center may be a part of a business that is expected to form an identifiable…
Q: _______________ are the costs associated with not choosing the other alternative Sunk costs
A: Relevant costs: These are the costs which are relevant to a decision
Q: Why do many managers prefer variable costing over absorption costing?
A: Variable Costing: The variable costing is the method of costing in which only the variable…
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- Which statement is correct? A. Activity-based cost systems are less costly than traditional cost systems. B. Activity-based cost systems are easier to implement than traditional cost systems. C. Activity-based cost systems are more accurate than traditional cost systems. D. Activity-based cost systems provide the same data as traditional cost systems.What are two disadvantages of ROI? Explain how each can lead to decreased profitability.When deciding whether to sell as is or process a product further, managers should ignore which of the following? a. The costs of processing the product thus far b. The cost of processing further c. The revenue if the product is sold as is d. The revenue if the product is processed further
- When deciding whether to sell as is or process a product further, managers should ignore which of the following? The costs of processing the product thus far The cost of processing further The revenue if the product is sold as-is The revenue if the product is processed furthera difference in cost-plus pricing and target costing is that target costing starts with the price customers are willing to pay whereas cost-plus pricing starts with the cost. computes the desired markup while cost-plus pricing computes the maximum cost the company is willing to incur. is generally determined after introducing a product and cost-plus pricing is determined before introducing a product. is a simple approach while cost-plus pricing is relatively complex.When constrained by a limiting resource, managers often seek to produce those products which have: Question options: a)The highest selling prices. b)The lowest average cost per unit. c)The highest contribution margin ratios. d)The highest contribution margin per unit of limiting resource.
- if we produce goods over the capacity, should we consider the fixed marketing cost and variable marketing cost when making the decision to accept or reject a special offer?When constrained by a limiting resource, managers often seek to produce those products which have: a)The highest selling prices. b)The lowest average cost per unit. c)The highest contribution margin ratios. d)The highest contribution margin per unit of limiting resource.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.
- Explain why a new product costing system may be needed when line managers suggest that an apparently profitable product be dropped.Which of the following is false regarding activity-based costing (ABC)? a. Companies that have a high potential for cost distortions are more likely to benefit from ABC b. Opportunities for continuous improvement are rarely revealed by using ABC. c. The cost of implementing ABC may outweigh the benefits d. Increased accuracy with budgeting resources is often realizedWhich of the following is not a consideration when a manager is deciding to discontinue a product or product line? Whether the product has a positive or negative contribution margin. Determining if direct fixed costs could be avoided if the product or product line is discontinued. If discontinuing the product or product line will affect sales of remaining products. Not having any free capacity.
