FUNDAMENTALS OF COST ACCT.(LL) >CUSTOM<
5th Edition
ISBN: 9781259912733
Author: LANEN
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Chapter 8, Problem 11CADQ
We have discussed two methods for
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Students have asked these similar questions
In a process costing system, which of the following would be TRUE?
a.There is no need to use time tickets to assign costs to processes.
b.There is no need to track materials to processes.
c.A process costing system is more expensive to maintain because it has more work-in-process accounts.
d.All of these choices are true.
You mention changes and revisions to the standard cost systems. If you were the Operations manager of a manufacturing firm, what control would you have in place to assure those changes were proper and accurate? What assertions would apply here?
Why would a business that uses traditional costing systems consider implementing activity-based costing? Discuss the following in your answer:
Problems with traditional costing systems in a modern manufacturing environment.
Whether the benefits of activity-based costing always outweigh the costs.
Chapter 8 Solutions
FUNDAMENTALS OF COST ACCT.(LL) >CUSTOM<
Ch. 8 - What are the characteristics of industries most...Ch. 8 - A manufacturing company has records of its...Ch. 8 - If costs increase from one period to another, will...Ch. 8 - What are the five steps to follow when computing...Ch. 8 - What is the distinction between equivalent units...Ch. 8 - Which method, weighted-average or FIFO, better...Ch. 8 - It has been said that a prior departments costs...Ch. 8 - The more important individual unit costs are for...Ch. 8 - Assume that the number of units transferred out of...Ch. 8 - The management of a liquid cleaning product...
Ch. 8 - We have discussed two methods for process costing,...Ch. 8 - A friend owns and operates a consulting firm that...Ch. 8 - The controller of a local firm that uses a...Ch. 8 - Throughout the chapter, we treated conversion...Ch. 8 - Consider a manufacturing firm with multiple...Ch. 8 - Prob. 16CADQCh. 8 - Would process costing work well for a service...Ch. 8 - Compute Equivalent Units: Weighted-Average Method...Ch. 8 - Compute Equivalent Units: FIFO Method Refer to the...Ch. 8 - Compute Equivalent Units: Weighted-Average Method...Ch. 8 - Compute Equivalent Units: FIFO Method Refer to the...Ch. 8 - Compute Equivalent Units Magic Company adds...Ch. 8 - Equivalent Units: Weighted-Average Process Costing...Ch. 8 - Compute Equivalent Units: Ethical Issues Aaron...Ch. 8 - Equivalent Units and Cost of Production By...Ch. 8 - Compute Costs per Equivalent Unit:...Ch. 8 - Prob. 27ECh. 8 - Compute Equivalent Units: FIFO Method Materials...Ch. 8 - Compute Equivalent Units and Cost per Equivalent...Ch. 8 - Cost Per Equivalent Unit: Weighted-Average Method...Ch. 8 - Compute Costs per Equivalent Unit:...Ch. 8 - Prob. 32ECh. 8 - Compute Costs per Equivalent Unit: FIFO Method...Ch. 8 - Prob. 34ECh. 8 - Compute Costs per Equivalent Unit:...Ch. 8 - Assign Costs to Goods Transferred Out and Ending...Ch. 8 - Prob. 37ECh. 8 - Assign Costs to Goods Transferred Out and Ending...Ch. 8 - Prepare a Production Cost Report: FIFO Method...Ch. 8 - Prepare a Production Cost Report: Weighted-Average...Ch. 8 - Prepare a Production Cost Report: Weighted-Average...Ch. 8 - Prepare a Production Cost Report: FIFO Method...Ch. 8 - Cost of Production: Weighted-Average and FIFO...Ch. 8 - Operation Costing: Ethical Issues Brokia...Ch. 8 - Prob. 45ECh. 8 - Prob. 46PCh. 8 - Prob. 47PCh. 8 - Prob. 48PCh. 8 - Prob. 49PCh. 8 - Prob. 50PCh. 8 - Prob. 51PCh. 8 - Prepare a Production Cost Report and Show Cost...Ch. 8 - Prob. 53PCh. 8 - Prob. 54PCh. 8 - Prepare a Production Cost Report: Weighted-Average...Ch. 8 - Prob. 56PCh. 8 - Prob. 57PCh. 8 - Prob. 58PCh. 8 - Prob. 59PCh. 8 - Process Costing and Ethics: Increasing Production...
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- Overhead application to costs is a critical issue for the costing of your products. We are studying several ways to handle this situation. What would cause an overhead to be overapplied, or underapplied. Discuss the results to your decision making and the financial statements for each of those two situations.arrow_forwardWhich of the following is false about activity-based costing? Implementing an activity-based costing system is more costly than implementing a traditional cost allocation system. In ABC, the assumption is that activities use resources or cause costs. An activity-based costing system relies only on volume measures such as direct labor hours to allocate all overhead costs to products. A traditional cost allocation system and an activity-based costing system are used to estimate the profitability of products.arrow_forwardProcess costing systems are used only by companies that manufacture physical products; companies that provide services do not use process costing. True or False please dont give plagiarised solutions thank youarrow_forward
- 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 plantwiderates to assign cost accurately.arrow_forwardDiscuss how traditional methods of allocating overhead to products may not provide a good measure of overhead resources used. How might activity based costing overcome these limitations?arrow_forwardIt is your first day at a new job and you talk about the themes of cost system design. One of your new colleagues asks, “If different cost information is used for different purposes, does that mean we do not know what something costs? I thought that was what a cost system reported.” How would you respond?arrow_forward
- Which of the following statements regarding activity-based costing (ABC) is NOT correct? a. Under ABC cost centres are replaced by cost pools b. Blanket overhead recovery rates (OAR) are replaced with cost driver rates c. ABC uses one common overhead recovery rate, such as labour hours. d. ABC tackles the problems of absorption costing by adopting a much more accurate way of charging overhead to cost units.arrow_forwardExplain 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.arrow_forwardWhich of the following statements is true regarding by products? a. Process costing is the only method that should result in by-products. b. Job order costing systems will never have by-products. c. Job order costing systems may have instances where by-products result from the production process. d. Process costing will never have by-products from the production process.arrow_forward
- If the Activity-Based Costing (ABC) method's main intention is to find a possibility to cut the Overhead and indirect costs from the cost of production, is the blow statement correct? Please explain thoroughly with examples and restate the correct statement if it is false. When a company implements activity-based costing, manufacturing overhead cost is often shifted from low volume products to high volume products, with a lower unit cost resulting for the high volume products. When a company implements activity-based costing, manufacturing overhead cost is often shifted from high volume products to low volume products, with a higher unit cost resulting for the low volume products. Does the shift from low-volume to high-volume or vice versa affect the product cost?arrow_forwardOrganizations are motivated to use multiple indirect cost pools instead of a single indirect cost pool when Select one: O a. Multiple Indirect cost pools are needed to conform to external reporting requirements b. manufacturing overhead costs are difficult to control c. the cost drivers for the multiple indirect cost pools are different from the cost driver of the single indirect cost pool d. none of the optionsarrow_forwardHello, Have a question. Which of the following are the advantages of the ABC approach relative to using a single predetermined overhead application rate based on direct labor hours? Select all that apply. A. ABC does not help in decision making. B. ABC systems produce more accurate financial information. C. ABC approach is likely to provide better information to manufacturing managers. D. ABC helps in decision making. E. ABC systems produce more accurate product costing information. Thanks...arrow_forward
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