Questions from Cost Accounting

Q: How do budgeted cost rates motivate the support-department manager to

How do budgeted cost rates motivate the support-department manager to improve efficiency?

Q: Give examples of allocation bases used to allocate support-department cost

Give examples of allocation bases used to allocate support-department cost pools to operating departments.

Q: “To ensure unbiased cost allocations, fixed costs should be allocated

“To ensure unbiased cost allocations, fixed costs should be allocated on the basis of estimated long-run use by user-department managers.” Do you agree? Why?

Q: What is conceptually the most defensible method for allocating support-department

What is conceptually the most defensible method for allocating support-department costs? Why?

Q: Give two examples of industries in which joint costs are found.

Give two examples of industries in which joint costs are found. For each example, what are the individual products at the splitoff point?

Q: How might a company simplify its use of the NRV method when

How might a company simplify its use of the NRV method when final selling prices can vary sizably in an accounting period and management frequently changes the point at which it sells individual produ...

Q: Describe two major methods to account for byproducts.

Describe two major methods to account for byproducts.

Q: What is a joint cost? What is a separable cost?

What is a joint cost? What is a separable cost?

Q: Why does the sales value at splitoff method use the sales value

Why does the sales value at splitoff method use the sales value of the total production in the accounting period and not just the revenues from the products sold?

Q: Fitzgerald Supermarkets (FS) operates at capacity and decides to apply

Fitzgerald Supermarkets (FS) operates at capacity and decides to apply ABC analysis to three product lines: baked goods, milk and fruit juice, and frozen foods. It identifies four activities and their...