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Solution Maunal For Cost Accounting A Data Analytics Approach 2024 Release By Margaret Christ, D. Kip Holderness and Vernon Richardson ( ALL CHAPTERS COVERED)$17.99
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Solution Maunal For Cost Accounting A Data Analytics Approach 2024 Release By Margaret Christ, D. Kip Holderness and Vernon Richardson ( ALL CHAPTERS COVERED)
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Solution Maunal For Cost Accounting A Data Analytics Approach 2024 Release By Margaret Christ, D. Kip Holderness and Vernon Richardson ( ALL CHAPTERS COVERED)
Solution Maunal For Cost
Accounting A Data Analytics
Question 1:
Which of the following is an advantage of using activity-based costing (ABC) over
traditional costing systems?
A) ABC systems are simpler and less costly to implement.
B) ABC provides more accurate product costing by focusing on activities that drive
costs.
C) ABC assigns costs based solely on the volume of production.
D) ABC ignores non-manufacturing costs and focuses only on direct costs.
,Answer:
B) ABC provides more accurate product costing by focusing on activities that drive
costs.
Rationale:
Activity-based costing focuses on allocating overhead more accurately by identifying
activities that cause costs and assigning those costs based on actual usage. This
improves the precision of product cost information compared to traditional volume-
based allocation methods.
Question 2:
Which of the following is the primary focus of a cost-volume-profit (CVP) analysis?
A) To determine the profitability of different product lines.
B) To analyze how changes in sales volume, costs, and prices impact profit.
C) To allocate overhead costs to products.
D) To identify the fixed and variable costs associated with production.
Answer:
B) To analyze how changes in sales volume, costs, and prices impact profit.
Rationale:
Cost-volume-profit analysis helps managers understand the relationship between
costs, sales volume, and profits. It is used to make decisions regarding pricing,
product mix, and cost control.
Question 3:
In cost accounting, the term "relevant costs" refers to:
A) Costs that do not change as a result of a decision.
B) Historical costs that have already been incurred.
C) Costs that should be ignored when making decisions.
,D) Costs that are directly related to a specific decision and will affect future costs.
Answer:
D) Costs that are directly related to a specific decision and will affect future costs.
Rationale:
Relevant costs are those that are expected to be incurred or avoided due to a
specific decision. They include future costs that differ among the available
alternatives.
Question 4:
Which of the following costs are typically considered as fixed costs?
A) Direct materials
B) Direct labor
C) Factory rent
D) Sales commissions
Answer:
C) Factory rent
Rationale:
Fixed costs do not vary with production levels and remain constant over a period of
time. Factory rent is an example of a fixed cost as it remains unchanged regardless of
the amount of production.
Question 5:
The high-low method is primarily used to:
A) Determine the break-even point for production.
B) Separate mixed costs into their fixed and variable components.
C) Allocate indirect costs to specific cost objects.
, D) Calculate the contribution margin ratio.
Answer:
B) Separate mixed costs into their fixed and variable components.
Rationale:
The high-low method is a cost accounting technique used to break down mixed costs
into fixed and variable components by analyzing the highest and lowest levels of
activity and their associated costs.Question 6:
Which of the following best describes the concept of contribution margin?
A) The difference between sales revenue and total costs.
B) The amount remaining after variable costs have been deducted from sales
revenue.
C) The total fixed costs of a business.
D) The profit remaining after fixed costs have been paid.
Answer:
B) The amount remaining after variable costs have been deducted from sales
revenue.
Rationale:
Contribution margin measures the profitability of a product by calculating how much
revenue is available to cover fixed costs after variable costs have been deducted.
Question 7:
A company is considering replacing an old machine with a new one. The relevant
costs to consider in this decision include:
A) The historical cost of the old machine.
B) The future cash flows generated by the new machine.
C) The depreciation expense of the old machine.
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