(Test Bank) Cornerstones Of Cost Accounting Canadian Edition

Hansen, 1

Business

Test Bank

1st Edition

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Test Bank for Cornerstones Of Cost Accounting Canadian Edition, The downloadable file consists of 838 pages, and the total size of the file is 5.57 MB. Purchase now only for highly discounted price.

Author(s): Hansen

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Test Bank for Cornerstones of Cost Accounting 1e Canadian Edition by Don Hansen Chapter 1a —Basic Cost Management Concepts MULTIPLE CHOICE 1. Which of the following is NOT a transformational process in an accounting information system? a. collecting data b. analyzing data c. performance reporting d. summarizing data ANS: C PTS: 1 DIF: Medium REF: p. 3 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 2. Which of the following is NOT a process associated with an accounting information system? a. auditing existing data b. collecting and recording data c. providing information to users d. analyzing and managing data ANS: A PTS: 1 DIF: Moderate REF: p. 3 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 3. What does an accounting information system usually use as inputs? a. financial statements b. data analyses c. performance reports d. economic events ANS: D PTS: 1 DIF: Easy REF: p. 3 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 4. What accounting information subsystem is devoted to providing information for external users? a. management accounting b. financial accounting c. internal accounting d. cost accounting ANS: B PTS: 1 DIF: Easy REF: p. 3 OBJ: 1-1 NAT: AACSB Communication MSC: Remember 5. What is the term for a set of interrelated parts that performs one or more processes to accomplish specific objectives? a. cost objective b. system c. activity d. cost driver ANS: B PTS: 1 DIF: Easy REF: p. 3 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 6. What is financial accounting information NOT used for? a. investment decisions b. regulatory measures c. stewardship evaluation d. costing products ANS: D PTS: 1 DIF: Easy REF: p. 4 OBJ: 1-1 NAT: AACSB Communication MSC: Higher Order 7. Which of the following is NOT part of the financial accounting information system? a. filing reports with the SEC b. reporting a large contingent liability to current and potential shareholders c. determining the future cash flows of a proposed flexible manufacturing system d. preparing GAAP financial statements ANS: C PTS: 1 DIF: Medium REF: p. 4 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 8. Which of the following does NOT describe the cost management information system? a. It evaluates segments or products within the firm. b. It places an emphasis on the future. c. It is externally focused. d. It focuses on the effective use of resources. ANS: C PTS: 1 DIF: Medium REF: p. 4 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 9. Which of the following activities is NOT associated with the financial accounting information system? a. reporting on the cost of quality b. reporting to the provincial securities commission c. preparing reports for the CRA d. preparing a statement of cash flows ANS: A PTS: 1 DIF: Medium REF: p. 4 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 10. In a company that supplies garlic bread to pizza restaurants, which of the following would be considered an input? a. completed product b. flour c. baking d. labour cost of the baker ANS: B PTS: 1 DIF: Moderate REF: p. 4 OBJ: 1-1 NAT: AACSB Analytic MSC: Higher Order 11. In a company that supplies garlic bread to pizza restaurants, which of the following would be considered inputs? a. flour, garlic, oil b. completed product, garlic, oil c. flour, completed product, oil d. flour, garlic, completed product ANS: A PTS: 1 DIF: Moderate REF: p. 4 OBJ: 1-1 NAT: AACSB Analytic MSC: Higher Order 12. In a company that supplies garlic bread to pizza restaurants, which of the following would be considered a transforming process? a. baking, packaging, mixing b. delivering, packaging, mixing c. baking, delivering, mixing d. baking, packaging, delivering ANS: A PTS: 1 DIF: Moderate REF: p. 4 OBJ: 1-1 NAT: AACSB Analytic MSC: Higher Order 13. In a company that supplies garlic bread to pizza restaurants, which of the following would be considered a transforming process? a. delivering b. baking c. ordering d. testing ANS: B PTS: 1 DIF: Moderate REF: p. 4 OBJ: 1-1 NAT: AACSB Analytic MSC: Higher Order 14. In a company that supplies garlic bread to pizza restaurants, what would the delivered garlic bread be considered? a. an interrelated part b. an input c. an output d. a process ANS: C PTS: 1 DIF: Moderate REF: p. 4 OBJ: 1-1 NAT: AACSB Analytic MSC: Higher Order 15. In an accounting information system, which of the following are part of the transformation process? a. creating performance reports, analyzing data, summarizing data b. collecting data, creating performance reports, summarizing data c. collecting data, analyzing data, summarizing data d. collecting data, analyzing data, creating performance reports ANS: C PTS: 1 DIF: Easy REF: p. 4 OBJ: 1-1 NAT: AACSB Reflective MSC: Higher Order 16. What is the overall objective of accounting information systems? a. to provide information to users b. to manage the organization c. to prepare financial reports d. to report to the government ANS: A PTS: 1 DIF: Easy REF: p. 4 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 17. In an accounting information system, what usually are the inputs? a. financial statements b. data analysis c. performance reports d. economic events ANS: D PTS: 1 DIF: Easy REF: p. 4 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 18. Which of the following is a cost management subsystem designed to assign costs to individual products and services and other objects, as specified by management? a. financial accounting information system b. operational control information system c. cost accounting information system d. continuous improvement system ANS: C PTS: 1 DIF: Easy REF: p. 4 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 19. Which of the following is a cost management subsystem designed to provide accurate and timely feedback concerning the performance of managers and others relative to their planning and control of activities? a. financial accounting information system b. operational control information system c. cost accounting information system d. continuous improvement system ANS: B PTS: 1 DIF: Easy REF: p. 4 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 20. What is the term for an accounting information subsystem that is primarily concerned with producing outputs for external users? a. cost management information system b. computer infor mation system c. internal accounting system d. financial accounting information system ANS: D PTS: 1 DIF: Easy REF: p. 4 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 21. Which of the following would NOT be a benefit of a cost management system? a. increasing speed by ignoring nonfinancial information b. reducing duplicate data storage and use of data c. improving timeliness of reports d. increasing the efficiency of generating reliable and accurate information ANS: A PTS: 1 DIF: Moderate REF: p. 4 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 22. What is a major subsystem of the cost accounting information system? a. enterprise resource planning b. operational control information system c. on-line analytical processing d. electronic data interface ANS: B PTS: 1 DIF: Easy REF: p. 4 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 23. In a cost management system, what does the process view NOT include? a. resources b. activities c. driver analysis d. performance analysis ANS: A PTS: 1 DIF: Easy REF: p. 4 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 24. In a cost management system, what does the cost view NOT include? a. resources b. activities c. driver analysis d. products and customers ANS: C PTS: 1 DIF: Easy REF: p. 4 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 25. Why are cost management reports prepared? a. to meet the needs of decision makers within the firm b. to meet stockholders’ requests c. to meet guidelines prepared by the provincial securities commission d. to meet financial accounting standards ANS: A PTS: 1 DIF: Medium REF: p. 5 OBJ: 1-1 NAT: AACSB Communication MSC: Higher Order 26. Which of the following is NOT provided by cost accountants? a. cost information in accordance with GAAP b. cost information about processes and activities c. financial information for external users d. cost information about products, customers, and services ANS: C PTS: 1 DIF: Medium REF: p. 5 OBJ: 1-1 NAT: AACSB Reflective MSC: Higher Order 27. What is the primary objective of the cost management information system? a. to provide shareholders and potential investors with useful information for decision making b. to provide banks and other creditors with information useful in making credit decisions c. to provide management with information useful for planning and control of operations d. to provide the Canada Revenue Agency with information about taxable income ANS: C PTS: 1 DIF: Easy REF: p. 5 OBJ: 1-1 NAT: AACSB Reflective MSC: Higher Order 28. What is the cost management information system concerned with? a. reporting financial information according to GAAP b. providing cost information that is used in planning, control, and decision making c. reporting to external users d. providing financial information to investors ANS: B PTS: 1 DIF: Easy REF: p. 5 OBJ: 1-1 NAT: AACSB Communication MSC: Higher Order 29. To whom does the cost management branch of accounting report? a. internal managers b. shareholders c. the government d. bankers ANS: A PTS: 1 DIF: Easy REF: p. 5 OBJ: 1-1 NAT: AACSB Communication MSC: Remember 30. Which of the following broadens the focus of accounting because it is concerned with factors that drive costs, such as cycle time and process productivity? a. cost accounting b. cost management c. financial management d. financial accounting ANS: B PTS: 1 DIF: Easy REF: p. 5 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 31. Which of the following statements is NOT true for cost accounting? a. It is concerned with assigning costs to various cost objects. b. It attempts to satisfy the costing objectives of both financial accounting and management accounting. c. It provides cost information that supports planning, controlling, and decision making. d. It is primarily concerned with producing reports for external users. ANS: D PTS: 1 DIF: Easy REF: p. 5 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 32. Which of the following activities is NOT associated with the cost management information system? a. preparing a cost of quality report b. preparing a performance report that compares actual costs to budgeted costs c. determining the cost o f a customer d. using future expected earnings to estimate the price of a share of common stock ANS: D PTS: 1 DIF: Medium REF: p. 5 OBJ: 1-1 NAT: AACSB Reflective MSC: Higher Order 33. Which costing activity is associated with the financial accounting system? a. determining the cost of a department b. determining the cost of goods sold for financial statements c. preparing budgets d. determining the cost of a customer ANS: B PTS: 1 DIF: Easy REF: p. 5 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 34. Which activity is associated with the cost management information system? a. preparing reports for division managers b. preparing reports for the IRS c. preparing reports for the SEC d. preparing financial statements that conform to GAAP ANS: A PTS: 1 DIF: Easy REF: p. 5 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 35. What cost management subsystem is designed to assign costs to individual products and services and other objects, as specified by management? a. financial accounting information system b. operational control system c. cost accounting information system d. management control system ANS: C PTS: 1 DIF: Medium REF: p. 5 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 36. What cost management tool supports a firm’s concentration on the delivery of value to the customer? a. service industry growth b. global competition c. preparing an earnings report for the SEC d. value -chain analysis ANS: D PTS: 1 DIF: Easy REF: p. 5 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 37. Which of the following is a non -value -chain product cost? a. research and development b. rework c. production d. customer service ANS: B PTS: 1 DIF: Moderate REF: p. 5 OBJ: 1-1 NAT: AACSB Reflective MSC: Higher Order 38. Which of the following objectives do product value -chain costs assist managers in meeting? a. merchandise mix decisions b. tactical profitability analysis c. external financial reporting d. strategic design decisions ANS: A PTS: 1 DIF: Difficult REF: p. 5 OBJ: 1-1 NAT: AACSB Reflective MSC: Higher Order 39. What is the operational control system concerned with? a. investment decisions b. what activities should be performed and assessing how well they are performed c. the consumption of productive resources by individual products d. setting prices ANS: B PTS: 1 DIF: Medium REF: p. 6 OBJ: 1-1 NAT: AACSB Reflective MSC: Higher Order 40. What is the term for a computerized information system that strives to input data once and make it available to people across the company for different purposes? a. cost management information system b. enterprise resource planning system c. internal accounting system d. financial account ing system ANS: B PTS: 1 DIF: Easy REF: p. 6 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 41. Which of the following is NOT an advance in information technology that affects firms? a. computer integrated applications b. GAAP reporting c. emergence of electronic commerce d. availability of tools such as OLAP and DSS ANS: B PTS: 1 DIF: Medium REF: p. 6 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 42. What is the term for software that has integrated system capability using real-time data? a. enterprise resource planning software b. on-line analytic programs c. computer -assisted engineering software d. just-in-time system ANS: A PTS: 1 DIF: Easy REF: p. 6 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 43. What has the increased importance of costing activities in the value chain and determining the cost of different suppliers and customers led to? a. the emergence of OLAP b. the emergence of EDI c. the emergence of CAM d. the emergence of theory of constraints ANS: B PTS: 1 DIF: Easy REF: p. 6 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 44. What is the term for any form of commerce that is executed using information and communications technology? a. enterprise resource planning b. on-line analytical processing c. electronic commerce d. decision support system ANS: C PTS: 1 DIF: Easy REF: p. 6 OBJ: 1-1 NAT: AACSB Reflective MSC: Higher Order 45. Which of the following is NOT significant to the advancement of information technology? a. enterprise resource planning software b. emergence of electronic commerce c. theory of constraints d. decision support systems ANS: C PTS: 1 DIF: Medium REF: p. 6 OBJ: 1-1 NAT: AACSB Reflective MSC: Higher Order 46. What is the term for a computerized information system that strives to input data once and to make it available to people across a company for different purposes? a. cost management information system b. enterprise resource planning system c. internal accounting system d. financial accounting information system ANS: B PTS: 1 DIF: Easy REF: p. 6 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 47. What is the term for a cost management subsystem designed to provide accurate and timely feedback concerning the performance of managers and others relative to their planning and control activities? a. cost accounting information system b. financial accounting system c. operational control information system d. tax reporting system ANS: C PTS: 1 DIF: Moderate REF: p. 6 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 48. What is the state of the service sector in Canada today? a. The service sector comprises approximately 75 percent of the Canadian economy and employment. b. The service sector comprises approximately 20 percent of the Canadian economy and employment. c. The service sector has decreased and traditional smokestack industries have increased in importance in recent years. d. The service sector has decreased in impor tance in recent years. ANS: A PTS: 1 DIF: Medium REF: p. 7 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 49. Which factors led to a global market for manufacturing and service firms? a. improved transportation and communications systems b. improved telemarketing and communications systems c. improved distribution and transportation systems d. improved telemarketing and distribution systems ANS: A PTS: 1 DIF: Easy REF: p. 7 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 50. How is competitive advantage established? a. by providing more customer products than one’s competitors b. by providing better quality than one’s competitors c. by providing greater customer value for less cost than one’s competitors d. by providing greater efficiencies than one’s competitors ANS: C PTS: 1 DIF: Medium REF: p. 7 OBJ: 1-1 NAT: AACSB Reflective MSC: Higher Order 51. Cost management information systems further competitive advantage by supporting three fundamental organizational goal s. Which of the following is NOT one of these three goals? a. maximizing time -based performance b. improving the quality of products and services c. maximizing shareholder value d. improving efficiency ANS: C PTS: 1 DIF: Medium REF: p. 7 OBJ: 1-1 NAT: AACSB Reflective MSC: Higher Order 52. Which of the following actions does NOT improve time performance? a. redesigning products b. adding processes in production c. minimizing waste d. eliminating non -value -added activities ANS: B PTS: 1 DIF: Easy REF: p. 7 OBJ: 1-1 NAT: AACSB Reflective MSC: Higher Order 53. Which of the following is NOT one of the features of an operational control information system? a. to assist in continuous improvement of all aspects of the business b. to improve the value received by customers c. to improve profits by improving value d. to provide product cost information needed by management ANS: D PTS: 1 DIF: Difficult REF: p. 7 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 54. Which of the following is NOT an objective of the operational control system? a. increasing value to customers b. increasing profit by providing value c. increasing post -purchase costs d. increasing value -added activities ANS: C PTS: 1 DIF: Moderate REF: p. 7 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 55. What has increased along with the automation of the manufacturing environment? a. inventory b. productive capacity c. processing time d. costs ANS: B PTS: 1 DIF: Medium REF: p. 8 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 56. Which of the following approaches has NOT led to advancements in the manufacturing environment? a. theory of constraints b. computer -integrated manufacturing c. just-in-time manufacturing d. push system manufacturing ANS: D PTS: 1 DIF: Easy REF: p. 8 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 57. In just -in-time manufacturing, how much does each operation produce? a. only what is necessary for the succeeding operations b. all that it can to offset fixed costs c. a fixed percentage in excess of orders to ensure adequate quality stock d. all that it can in order to build inventories ANS: A PTS: 1 DIF: Medium REF: p. 8 OBJ: 1-1 NAT: AACSB Reflective MSC: Higher Order 58. What emerging trend in cost accounting deals with managers striving to create an environment that will enable workers to manufacture perfect (zero -defect) products? a. advances in information technology b. time as a competitive element c. global competition d. total quality management ANS: D PTS: 1 DIF: Medium REF: p. 8 OBJ: 1-1 NAT: AACSB Reflective MSC: Higher Order 59. What is NOT the emphasis of total quality management? a. zero defects b. continual improvement c. elimination of waste d. increasing inventory ANS: D PTS: 1 DIF: Easy REF: p. 8 OBJ: 1-1 NAT: AACSB Reflective MSC: Remember 60. Which of the following activity is NOT associated with strategic analysis and new product development? a. using life -cycle costing b. employing target costing c. implementing activity -based management d. creating performance reports ANS: D PTS: 1 DIF: Medium REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 61. What is a critical measure of efficiency? a. the cost of activity b. a T-test c. customer satisfaction d. employee job satisfaction ANS: A PTS: 1 DIF: Medium REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Remember 62. Today’s cost managers must assemble cost information and determine how to value things. Which methods would NOT be critical to achieving this? a. foreign currency translation b. costing and quality analysis c. differentiating between value -added and non -value -added activities d. measuring productivity ANS: A PTS: 1 DIF: Easy REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 63. Which of the following represents the resources given up that are expected to bring a current or future benefit to an organization? a. cost b. expired cost c. expense d. loss ANS: A PTS: 1 DIF: Easy REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Remember 64. What is the term for the cash or cash equivalent value sacrificed for goods and services that are expected to bring a current or future benefit to the organization? a. expense b. cost c. activity d. loss ANS: B PTS: 1 DIF: Easy REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Remember 65. What is the term for a cost used up in the production of revenues? a. unexpired cost b. expense c. loss d. asset ANS: B PTS: 1 DIF: Easy REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Remember 66. Which of the following is an example of a loss? a. the cost of a product delivered to a customer b. the cost of a delivered advertising campaign c. the cost of the purchase of equipment d. the cost of inventory destroyed in a flood ANS: D PTS: 1 DIF: Moderate REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 67. Which of the following is an example of an expense? a. the cost of a product delivered to a customer b. the cost of a proposed advertising campaign c. the cost of the purchase of equipment d. the write -off of an obsolete product ANS: A PTS: 1 DIF: Moderate REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 68. Which of the following is NOT an example of a possible cost object? a. a product b. a customer c. a department d. headquarters ANS: D PTS: 1 DIF: Moderate REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 69. Which of the following would NOT be a direct cost of operating a university computer centre? a. rent paid for computers b. a fair share of university utilities c. paper used by the centre d. computer consultants’ salaries ANS: B PTS: 1 DIF: Moderate REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 70. Which of the following methods of assigning costs is based on convenience or some assumed linkage and reduces the overall accuracy of the cost assignments? a. direct tracing b. driver tracing c. allocation d. indirect allocation ANS: C PTS: 1 DIF: Easy REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Remember 71. Which of the following costs incurred by a bus manufacturer would NOT be directly attributable to the finished product? a. the wages paid to assembly -line production workers b. the tires for buses c. the windshields for buses d. the depreciation on the factory building ANS: D PTS: 1 DIF: Moderate REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 72. What is the term for the assignment of indirect costs to cost objects? a. allocation b. direct tracing c. physical observation d. cost management ANS: A PTS: 1 DIF: Easy REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Remember 73. What is a disadvantage of assigning costs evenly over all cost objects? a. Not all costs will be assigned. b. Total costs will be distorted. c. Consumption patterns of other cost objects may differ. d. Calculations are difficult to complete. ANS: C PTS: 1 DIF: Difficult REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Remember 74. What statement is NOT true regarding the insurance paid on a factory? a. It is a direct cost if the cost object is the factory. b. It is an indirect cost if the cost object is th e product produced. c. It is a direct cost if the cost object is the accounting department. d. It is an indirect cost if the cost object is the production department. ANS: C PTS: 1 DIF: Difficult REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 75. Which of the following would NOT be a cost that could be directly traced to a custom piece of furniture based upon physical observation? a. the wood and upholstery materials that are in the final piece b. the labour of the worker assembling the piece of furniture c. the depreciation paid on factory equipment d. the labour of the woodworker who finishes the wood of the piece ANS: C PTS: 1 DIF: Difficult REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 76. What does the precision of driver tracing depend upon? a. physically observable relationships b. allocation estimations c. the strength of causal relationships described by the driver d. no causal connection ANS: C PTS: 1 DIF: Moderate REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 77. What cost accounting system uses only unit -based activity drivers to assign costs to cost objects? a. activity -based management b. activity -based costing system c. functional -based cost management system d. operational -based costing ANS: C PTS: 1 DIF: Easy REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Remember 78. Which of the following would be associated with a functional -based cost accounting information system? a. setup costs assigned to products using the number of setups as the driver b. purchasing costs assigned to products using number of direct labour hours as the activity driver c. customer service costs assigned to products using the number of complaints as the activity driver d. materials handling costs assigned to products using the number of moves as the activity driver ANS: B PTS: 1 DIF: Difficult REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 79. In a functional -based management system, which of the following is one NOT likely to find? a. unit- and non -unit-based cost drivers b. maximization of individual unit performance c. narrow and rigid product costing d. allocation intensive cost assignment ANS: A PTS: 1 DIF: Moderate REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 80. Which of the following statements would be associated with both a functional -based cost accounting information system and an activity -based cost information system? a. Overhead is assigned on a plant -wide rate based on direct labour hours. b. Customer service costs are assigned to products using number of complaints as the activity driver. c. Direct labour cost is assigned to products using direct tracing. d. Direct materials costs are allocated to product. ANS: C PTS: 1 DIF: Moderate REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 81. Which of the following focuses on the management of activities with the objective of improving the value received by the customer and the profit received by providing this value? a. activity -based management b. contemporary cost control c. functional -based cost management system d. JIT ANS: A PTS: 1 DIF: Easy REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 82. Which of the following is NOT a trait of a functional -based cost management system? a. unit-based drivers b. focus on managing activities c. allocation intensive d. narrow and rigid product costing ANS: B PTS: 1 DIF: Moderate REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 83. Which of the following is a trait of a functional -based cost management system? a. unit-based drivers b. tracing intensive c. use of both financial and nonfinancial measures of performance d. detailed activity information ANS: A PTS: 1 DIF: Moderate REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Higher Order 84. Which of the following is a trait of an activity -based cost management system? a. allocation -intensive b. narrow and rigid product costing c. non-unit-based drivers d. focus on managing costs ANS: C PTS: 1 DIF: Moderate REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Remember 85. Which of the following is NOT a benefit of an activity -based cost management system? a. greater product costing accuracy b. increased cost of implementing the system c. improved decision making d. enhanced strategic planning ANS: B PTS: 1 DIF: Moderate REF: p. 9 OBJ: 1-2 NAT: AACSB Reflective MSC: Remember