ADMS 2510

Question 1 Sunrise Pools and Spas manufactures fibreglass forms for in-ground pools and swim spas for all-season use. The company uses variable costing for internal management reports and absorption costing for external reports to shareholders, creditors, and the government. The company has provided the data for their swim spa business in years 1, 2, and 3 shown below. The company’s fixed manufacturing overhead per unit was constant at $4,000 for all three years: Year 1 Year 2 Year 3 In...

Chapter 4 Systems Design: Process Costing Garrison, Managerial Accounting, 12th Edition 125 True/False Questions 1. When materials are purchased in a process costing system, a work in process account is debited with the cost of the materials. Answer: False Level: Easy LO: 1 2. Any difference in the equivalent units calculated under the weighted-average and the FIFO methods is due to the units in the ending work in process inventory. Answer: False Level: Easy LO: 2,6 Appendix: 4 3. Th...

Chapter 13 Relevant Costs for Decision Making 652 Garrison, Managerial Accounting, 12th Edition True/False Questions 1. Fixed costs are sunk costs and are therefore irrelevant in decisions. Answer: False Level: Easy LO: 1 2. A complete income statement must be prepared as part of a differential cost analysis. Answer: False Level: Medium LO: 1 3. Future costs that do not differ between the alternatives in a decision are avoidable costs. Answer: False Level: Medium LO: 1 4. The book ...