Under traditional costing systems, which calculate a single predetermined overhead rate usi volume-based drivers, the cost of high-volume products tends to be: O a. Understated O b. Accurately calculated O c. None of the given answers O d. Cannot be judged due to insufficient information

Under traditional costing systems, which calculate a single predetermined overhead rate usi volume-based drivers, the cost of high-volume products tends to be: O a. Understated O b. Accurately calculated O c. None of the given answers O d. Cannot be judged due to insufficient information

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter6: Activity-based, Variable, And Absorption Costing

Section: Chapter Questions

Problem 13MC: Activity-based costing systems: A. use a single predetermined overhead rate based on machine hours...

See similar textbooks

Related questions

Q: Under marginal (Variable) costing system, which of the following cost items is NOT considered in…

A: Answer: c) Advertising expenditure

Q: Activity-based costing uses departments overhead rate to assign overhead .a O provides the same…

A: Activity based costing system is a costing system which says that all indirect costs or overheads…

Q: Overhead allocation based solely on a measure of volume such as direct labor-hours: A. is a key…

A: The allocation of overhead is the process of applying the indirect cost of manufacturing to the…

Q: In process costing by-product is defined as; a. A product produced at the same time as other…

A: While we put raw material in any process there are various products which can be derived. Some of…

Q: Which of the following is NOT true? Multiple Choice Activity-based costing allocates some…

A: Activity based costing allocates the overhead costs to different cost drivers on the basis of…

Q: umerous predetermined overhead rates while traditional uses only one. The way they assign direct…

A: Correct answer is Activity based costing may not assign all product costs to units if they are…

Q: A stapler manufacturer uses a single plantwide predetermined overhead allocation rate to allocate…

A: Step 1: Overhead cost is the cost spent by the business over and above the labor cost. It can be…

Q: Under variable costing, fixed manufacturing overhead is expensed at the time the units are produced.…

A: There are two costing system followed by the organization. (1) Variable costing method (2)…

Q: 1. Which of the following is a hybrid costing system that applies to batches of like or similar…

A: Note : As per answering guidelines only first question need to be answered However i answered…

Q: Which of the following statements is true Activity based costing can only be used in manufacturing…

A: Activity based costing system is a costing system which allocates or divides cost between various…

Q: 8. The weighted-average method of process costing differs from the FIFC process costing in that the…

A: Weighted Average method In accounting, the Weighted Average Cost (WAC) method of inventory valuation…

Q: Traditional Volume-based costing allocates indirect product costs based on the volume of output,…

A: Note: Hello. Since your question has multiple parts, we will solve the first question for you. If…

Q: First: To achieve accurate costing, a high degree of correlation must exist between the cost driver…

A: Introduction:- Activity based costing allocate manufacturing overhead costs to products in a more…

Q: A company that applies process costing is most frequentily characterized by Multiple Cholce Low…

A: Process costing is a technique of costing which helps in estimating the cost per unit of…

Q: Traditional Volume-based costing allocates indirect product costs based on the volume of output,…

A: Following is the answer to given question

Q: 1. Which of the following statement is not a feature of process costing system? The cost of…

A: *As per the guidelines if questions asked are interlinked, answer first 3 sub-parts only 1) Under…

Q: 8. The weighted-average method of process costing differs from the FIFO method of process costing in…

A: Answer : (D) does not consider the number of units in the beginning work in process inventory when…

Q: The weighted-average method of process costing: a. can be used under any cost flow assumption. b.…

A: Under the weighted average method of costing, beginning inventory and units started are combined to…

Q: ?Which of the following statements is not correct concerning multiple overhead rate systems None of…

A: Option a is the answer.

Q: Under traditional costing systems, which calculate a single predetermined overhead rate using…

A: Under traditional costing systems, which calculate a single predetermined overhead rate using…

Q: This entire amount is usually a differential or relevant cost Direct cost Period cost Conversion…

A: Relevant costs are the costs that can be avoidable cost and these costs are incurred only when a…

Q: Unit-level measures can distort product costing because the dernand for overhead resources nay be…

A: Product cost or expense can be categorised in very manner like we can take product cost like unit…

Q: An allocation base! O a. is a measure used to assign prime costs to products and services O b.…

A: An allocation base is the basis on which Cost accounting allocates overhead costs. An allocation…

Q: der traditional costing systems, which calculate a single predetermined overhead rate using volume-…

A: Overhead means the cost indirectly incured for manufacturing the product.

Q: f) 'Process costing is a term used in cost accounting to describe method for collecting and…

A: The scrap value of an abnormal loss is credited to the process account is false. The scrap value of…

Q: The following statements are correct except? A. ABC eliminates issues of over or under absorption B.…

A: Overhead means the cost incurred indirect in factory for the production of goods. Manufacturing…

Q: Which method of process costing is almost always used in practice? Multiple Choice a) Weighted…

A: Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…

Q: If the activities that generate overhead costs vary between departments and products, adopting a…

A: The Answer

Q: Under traditional costing systems, which calculate a single predetermined overhead rate using…

A: Answer: Under traditional costing systems, which calculate a single predetermined overhead rate…

Q: 0. The weighted-average method of process costing differs from the FIFO method of process costing in…

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

Q: If the predetermined overhead rate is based on the estimated level of activity for the current…

A: There are two main type of costs incurred in manufacturing the goods; 1) Direct costs and 2)…

Q: Activity-based costing: O a. may not assign all manufacturing overhead costs to products. O b. None…

A: Activity based costing is a method of assigning indirect costs or overhead costs to products and…

Q: Which of the following points about the Activity-based costing (ABC) system is NOT a correct…

A: Using activity based costing, the overheads rate is determined for different activities on the basis…

Q: When production is greater than sales, fixed manufacturing overhead costs are: a. Deferred in…

A: Variable Costing: Variable costing is the method of costing in which only the variable production…

Q: Accounting Direct labor or machine hours may not be the appropriate cost driver for overhead in all…

A: Activity based costing is the method used by the entities because it helps in reducing the…

Q: 8. The weighted-average method of process costing differs from the FIFO method of process costing in…

A: WEIGHTED-AVERAGE METHOD ADDS EQUIVALENT UNITS TO THE CURRENT MONTH PRODUCT AND CALCULATING AVERAGE…

Q: Departmental overhead rates may not correctly assign overhead costs due to: Multiple Choice

A: Introduction: In the old days, we cannot trace overhead costs so easily to assign products. For this…

Q: Under traditional costing systems, which calculate a single predetermined overhead rate using…

A: Cost refers to the monetary consideration which is incurred to produce, sell or to acquire items.…

Q: The amount manufacturing overhead that would be allocated to one unit of Dees using an activity -…

A: Solution Working note Calculation of the activity rate Activity Cost Activity measures…

Q: The product costing method that includes fixed manufacturing cost in inventories costs is called…

A: Variable cost is the cost which vary with the level of output where as fixed cost remain fixed what…

Q: method and weighted average methos if there is no beginning work in process inventory. In process…

A: Weighted average method and FIFO are the methods employed in process costing for transferring the…

Q: Please explain the statement below thoroughly with examples. (Ture or False) "In activity-based…

A: As per activity-based costing, each cost activity should be classified into the following four…

Question

3..

Under traditional costing systems, which calculate a single predetermined overhead rate using
volume-based drivers, the cost of high-volume products tends to be:
O a. Understated
O b. Accurately calculated
O C. None of the given answers
O d. Cannot be judged due to insufficient information
e. Overstated

Expert Solution

This question has been solved!

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

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 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 how a plantwide overhead rate, using a unit-based driver, can produce distorted product costs. In your answer, identify two major factors that impair the ability of plantwide rates to assign cost accurately.
Which is not a step in analyzing the cost driver for manufacturing overhead? A. Identify the cost B. identify non-value-added costs C. analyze the effect on manufacturing overhead D. identify the correlation between the potential driver and manufacturing overhead
Which is not a step In activity-based costing? A. identify the activities performed by the organization B. identify the cost driver(s) associated with each activity C. compute a cost rate per production D. assign costs to products by multiplying the cost driver rate by the volume of the cost driver units consumed by the product
Why does a company use a standard costing system? A. to identify variances from actual cost that assist them in maintaining profits B. to identify nonperformers in the workplace C. to identify what vendors are unreliable D. to identify defective materials
A company has traditionally allocated its overhead based on machine hours but collected this information to change to activity based costing: A. How much overhead would be assigned to each unit under the traditional allocation method? B. How much overhead would be assigned to each unit under activity-based costing?
Under variable costing, a unit of product includes which costs? direct material, direct labor, and manufacturing overhead Direct material, direct labor, and variable manufacturing overhead Direct material, direct labor, and fixed manufacturing overhead D. Direct material, direct labor, and all variable manufacturing overhead
Carltons Kitchens three cost pools and overhead estimates are as follows: Compare the overhead allocation using: A. The traditional allocation method B. The activity-based costing method (Hint: the traditional method uses machine hours as the allocation base.)
Trail Outfitters has this information for its manufacturing: Its income statement under absorption costing is as follows: Prepare an income statement with variable costing and a reconciliation statement between both methods.
Which of the following product situations is better suited to job order costing than to process costing? A. Each product batch is exactly the same as the prior batch. B. The costs are easily traced to a specific product. C. Costs are accumulated by department. D. The value of work in process is based on assigning standard costs.
Under absorption costing, a unit of product includes which costs? A. direct material, direct labor, and manufacturing overhead B. direct material, direct labor, and variable manufacturing overhead C. direct material, direct labor, and fixed manufacturing overhead D. direct material, direct labor, and all variable manufacturing overhead
Under what two conditions would the multiple production department factory overhead rate method provide more accurate product costs than the single plantwide factory overhead rate method?
Which of the following statements is true? a. Job-order costing is used only in manufacturing firms. b. Process costing is used only for services. c. Job-order costing is simpler to use than process costing because the recordkeeping requirements are less. d. The job cost sheet is subsidiary to the work-in-process account. e. All of these.