Matching Quiz

Match the terms listed below, with the appropriate desciption from the list on the right.


1				Activity


2				Activity-based costing (ABC)


3				Activity cost pool


4				Allocation base


5				Controllable costs


6				Cost centre


7				Cost driver


8				Cost pool


9				Departmental contribution to overhead


10				Direct expenses


11				Indirect expenses


12				Investment centre


13				Joint cost


14				Operating department


15				Profit centre


16				Responsibility accounting budget


17				Responsibility accounting performance report


18				Responsibility accounting system


19				Service department


20				Two-stage cost allocation method

Answer choices for questions 1 through 20

A)	A bucket in which costs are accumulated.
B)	The amount by which a department’s revenues exceed its direct expenses.
C)	Includes individual cost items incurred for the purposes of carrying out joint processes, leading to multiple outcomes.
D)	A two-stage allocation system. The two stages are: (1 identify activities involved in the manufacturing (or service) process and form cost pools by combining activities and (2 compute the predetermined overhead cost allocation rate for each cost pool and assign costs.
E)	Costs that a manager has the authority to determine or at least strongly influence.
F)	A variable that causes the cost of an activity to go up or down; a causal factor.
G)	Expenses traced to a specific department because they are incurred for the sole benefit of that department.
H)	A segment of business whose manager is responsible for profitability and the efficient use of assets.
I)	An accounting system that provides information that management can use to evaluate the performance of a department’s manager.
J)	A set of tasks that consume resources, thereby incurring overhead costs.
K)	Expenses incurred for the joint benefit of more than one department.
L)	A segment that incurs costs alone, such as the accounting or legal department.
M)	A method of allocating overhead costs, wherein service department costs are first assigned to operating departments, and the total costs within each operating department are then assigned to desired cost objects.
N)	A unit of a business that incurs costs and generates revenues.
O)	A plan that specifies the expected costs and expenses under the control of a manager.
P)	Carries out activities that directly contribute to the main purpose of an organization.
Q)	A responsibility accounting report that compares actual costs and expenses for a department with the budgeted amounts.
R)	A temporary account that accumulates the costs a company incurs to support an activity.
S)	The activity or volume measure used to charge the cost from one department to another.
T)	Provides support function to one or more operating and other service departments within an organization.

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