Questions from Cost Accounting


Q: Give three examples of opportunity costs that typically are not recorded in

Give three examples of opportunity costs that typically are not recorded in accounting systems, although they are relevant when using the EOQ model in the presence of demand uncertainty.

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Q: What are the steps in computing the cost of a prediction error

What are the steps in computing the cost of a prediction error when using the EOQ decision model?

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Q: Why might goal-congruence issues arise when managers use an EOQ

Why might goal-congruence issues arise when managers use an EOQ model to guide decisions on how much to order?

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Q: Vineyard Test Laboratories does heat testing (HT) and stress testing

Vineyard Test Laboratories does heat testing (HT) and stress testing (ST) on materials and operates at capacity. Under its current simple costing system, Vineyard aggregates all operating costs of $1,...

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Q: “JIT purchasing has many benefits but also some risks.” Do

“JIT purchasing has many benefits but also some risks.” Do you agree? Explain briefly.

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Q: What are three factors causing reductions in the cost to place purchase

What are three factors causing reductions in the cost to place purchase orders for materials?

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Q: “All overhead costs are relevant in NPV analysis.” Do you

“All overhead costs are relevant in NPV analysis.” Do you agree? Explain.

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Q: Bill Watts, president of Western Publications, accepts a capital budgeting

Bill Watts, president of Western Publications, accepts a capital budgeting project proposed by division X. This is the division in which the president spent his first 10 years with the company. On the...

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Q: Distinguish different categories of cash flows to be considered in an equipment

Distinguish different categories of cash flows to be considered in an equipment-replacement decision by a taxpaying company.

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Q: Describe three ways income taxes can affect the cash inflows or outflows

Describe three ways income taxes can affect the cash inflows or outflows in a motor-vehicle-replacement decision by a taxpaying company.

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