Questions from Cost Accounting

Q: What is suboptimization, and what factors contribute to it in a

What is suboptimization, and what factors contribute to it in a decentralized firm?

Q: Why are support department costs often allocated to operating departments? Is

Why are support department costs often allocated to operating departments? Is such an allocation process always useful from a decision-making standpoint? How might support department cost allocation c...

Q: The four criteria for selecting an allocation base for support department costs

The four criteria for selecting an allocation base for support department costs should be applied equally.” Discuss the merits of this statement.

Q: Compare and contrast the direct, step, and algebraic methods of

Compare and contrast the direct, step, and algebraic methods of allocating support department costs. What are the advantages and disadvantages of each method?

Q: What are transfer prices, and why do companies use them?

What are transfer prices, and why do companies use them? How could the use of transfer prices improve or impair goal congruence?

Q: What problems might be encountered when attempting to implement a cost-

What problems might be encountered when attempting to implement a cost-based transfer pricing system? A market-based transfer pricing system?

Q: What are the benefits of organizational mission and values statements? How

What are the benefits of organizational mission and values statements? How are organizational missions and strategies related to performance measures?

Q: A local businesswoman, Jane Aire, has hired you and a

A local businesswoman, Jane Aire, has hired you and a colleague, Joanna, from your cost accounting class to advise her regarding her small manufacturing business that makes leather valises. The busine...

Q: Why is the trend in U.S. business away from

Why is the trend in U.S. business away from automatic pay increases and toward increased use of incentive compensation plans?

Q: If worker performance measures used in a pay-for-performance

If worker performance measures used in a pay-for-performance plan are not highly correlated with corporate goals, what is the likely result for the organization? For the workers?