machine hours direct labor hours square feet number B u s i n e s s F i n a n c e
Support departments
(Points : 3)
are responsible for manufacturing the products sold to customers.
work directly on the products of the firm.
provide services directly to customers.
provide essential services to the producing departments.
2.
(TCO 7) Which would be the most appropriate base for allocating the costs of the housekeeping department?
(Points : 3)
|
Machine hours
Direct labor hours
Square feet
Number of employees
|
3.
(TCO 7) If the costs of support departments are NOT allocated to producing departments,
(Points : 3)
|
product costs would be understated.
GAAP requirements would not be met.
managers of producing departments may tend to overconsume services.
All of the above
|
4.
(TCO 7) Joint costs are allocated because of
(Points : 3)
|
financial reporting requirements.
tax reporting requirements.
IMA requirements.
Both A and B
|
5.
(TCO 7) Which method allocates support department costs?
(Points : 3)
|
Direct allocation method
Reciprocal allocation method
Sequential allocation method
All of the above
|
6.
(TCO 7) The cost of crude oil used in producing gasoline products is an example of
(Points : 3)
|
joint costs.
a by-product.
joint products.
common cost allocation.
|
7.
(TCO 7) A
joint cost allocation method that would assign the same amount of cost
per unit to two joint products that sell for $10 and $40, respectively,
is the
(Points : 3)
|
sales-value-at-split-off method.
direct allocation method.
net realizable value method.
physical unit method.
|
8.
(TCO 7) DeeDee Corporation manufactures the following products in its factory. $400,000 of costs were incurred.
|
Product
|
Units Produced
|
Weight per Unit (lb)
|
Selling Price per Unit
|
|
A
|
2,500
|
10
|
$6
|
|
B
|
5,000
|
8
|
$12
|
|
C
|
7,500
|
6
|
$12
|
|
D
|
10,000
|
4
|
$6
|
How much joint cost would be allocated to Product B based on the physical units method?
(Points : 3)
|
$420,000
$80,000
$106,667
$400,000
|
9.
(TCO 7)
Sally Corporation manufactures four products. The following data were
provided by the cost accountant for the current year.
|
Product
|
Units Produced
|
Sales Value at Split-Off
|
|
J
|
15,000
|
$10,000
|
|
K
|
9,000
|
$5,000
|
|
L
|
24,000
|
$6,000
|
|
M
|
12,000
|
$9,000
|
|
Total Joint Processing Costs
|
$24,000
|
Which is the amount of joint costs assigned to Product J using the sales-value-at-split-off method?
(Points : 3)
|
$8,000
$6,000
$24,000
$2,667
|
10.
(TCO 7) Lamb Inc. processes wool into four grades of yarn as follows.
|
Product
|
Yards Produced
|
Sales Value at Split-Off
|
|
Merino Wool
|
75,000
|
$56,250
|
|
Wool Singles
|
200,000
|
$180,000
|
|
Superwash Wool
|
100,000
|
$105,000
|
|
Plied Wool
|
125,000
|
$127,500
|
|
Total Joint Processing Costs
|
$300,000
|
Which is the amount of joint costs assigned to Superwash Wool using the constant gross margin percentage method?
(Points : 3)
|
$300,000
$67,200
$37,800
$192,000 |
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