Which statement is true or false
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1. The costs of activities that
are classified as unit-level should be proportional to the number of units
produced.
2.
Batch-level activities are performed each time a batch is handled or processed,
regardless of how many units are in the batch.
3.
Product-level activities relate to specific products and typically must be
carried out regardless of how many batches are run or units of product are
made.
4.
Activity-based management seeks to eliminate waste by allocating costs to
products that waste resources.
5.
Activity-based costing may supplement, rather than replace, a company"s
formal cost accounting system.
6. In
activity-based costing, nonmanufacturing costs as well as manufacturing costs
may be assigned to products.
7. When
activity-based costing is used for internal decision-making, the costs of idle
capacity should be considered period costs that flow through to the income
statement as an expense of the current period.
8. A
transaction driver provides a simple count of the number of times that an
activity occurs.
9. In
activity-based costing, all manufacturing costs must be included in product
costs.
10. The
first-stage allocation in activity-based costing is the process by which
overhead costs are assigned to activity cost pools.
11. The
activity rates computed in activity-based costing can provide valuable clues
concerning where there is waste and scope for improvement in an organization.
12. In
the second-stage allocation in activity-based costing, costs that were not
allocated in the first stage are assigned to the company"s most profitable
products.
13. If a
product has a negative product margin (i.e., loss) according to an
activity-based costing system, it should be dropped.
14. When
a company implements activity-based costing system, manufacturing overhead cost
is often shifted from low volume products to high volume products, with a
higher unit cost resulting for the high volume products.
15. An
action analysis report provides more detail about costs and how they might
adjust to changes in activity than a conventional activity-based costing
analysis.