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Chapter 8 Quiz 4
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1
Conventional product costing systems are usually based on activity-based cost drivers:
A)True
B)False
2
Greater product diversity has caused a decrease in production complexity and this has led to decreased demand for manufacturing overhead support, such as production scheduling, material handling and production setups:
A)True
B)False
3
An indicator of an outdated costing system may be when the company consistently wins bids for products that are difficult to produce and loses bids for simple products:
A)True
B)False
4
Activity-based costing (ABC) is a methodology that focuses only on the measure of the cost of cost objects:
A)True
B)False
5
Root-cause cost drivers are the underlying factors that cause activities to be performed and their costs to be incurred:
A)True
B)False
6
The most accurate approach in costing manufacturing overhead is to use a plant-wide overhead rate, where all manufacturing overhead costs are accumulated in a single cost pool and allocated to products using a single volume-based cost driver:
A)True
B)False
7
Collection of activity-based costing data is similar to the collection of conventional costing system data, which is one of the benefits of implementing such a system:
A)True
B)False





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