TRUE OR FALSE a, A cost that is traceable to a segment through activity-based costing is always an avoidable cost for decision making.   b. One way to increase the effective utilization of a bottleneck is to reduce the number of defective units.   c. Two or more products that are produced from a common input are known as joint products.

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter3: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 3TP: As a manager, you have to choose between two options for new production equipment. Machine A will...
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TRUE OR FALSE

a, A cost that is traceable to a segment through activity-based costing is always an avoidable cost for decision making.

 

b. One way to increase the effective utilization of a bottleneck is to reduce the number of defective units.

 

c. Two or more products that are produced from a common input are known as joint products.

 

d. If the salvage value of equipment at the end of a project is highly uncertain, the salvage value should be ignored in capital budgeting decisions.

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e. A cost that is traceable to a segment through activity-based costing is always an avoidable cost for decision making.

 

f. Eliminating nonproductive processing time is particularly important in a bottleneck operation.

 

g. In a decision to drop a product, the product should be charged for rent in proportion to the space it occupies even if the space has no alternative use and the rental payment is unavoidable. 

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