19) Which value chain function would include the cost of computer-aided design equipment and cost to develop the prototype of a product? A. The design of product, services, and processes function would include these costs. B. The production function would include these costs. C. The marketing function would include these costs D. The distribution function would include these costs. 20) Number of engineering hours is a likely cost driver for which value chain function? A. The design function has number of engineering hours as a likely cost driver. B. The marketing function has number of engineering hours as a likely cost driver. C. The production function has number of engineering hours as a likely cost driver D. The research and development function has number of engineering hours as a likely cost driver. 21) Which of the following is not a cost driver of customer services costs? A. Travel costs are not a cost driver of customer services costs. B. Number of service calls is not a cost driver of customer services costs. C. All of these answers are correct D. Hours spent servicing products are not a cost driver of customer services costs. 22) If the sales price per unit is $100, the total fixed costs are $75,000, and the break even volume in dollar sales is $250,000, then the variable cost per unit is _____. A. $100 B. $75,000 C. $30 D. $70 23) If the sales price per unit is $100, the unit variable cost is $75, and total fixed costs are $150,000, then the break even volume in dollar sales rounded to the nearest whole dollar is _____. A. $600,000 B. $150,000 C. $200,000 D. $1,500 24) Knothole Company sells desks at $480 per desk. The costs associated with each desk are as follows: Direct materials $195 Direct labor 126 Variable factory overhead 51 Total fixed costs for the period are $456,840. The break-even volume in dollars is _____. A. $1,573,560 B. $2,030,400 C. none of these answers is correct D. $456,840 25) _____ of approximating cost functions does not involve the analysis of past costs. A. Visual fit analysis B. Engineering analysis C. least-squares regression D. High low analysis 26) In relation to a cost function, the term reliability means_____. A. whether the cost function conforms to a given mathematical model B. how well the cost function predicts future costs C. how well the cost function explains past cost behavior D. whether the costs and activities can be easily observed 27) _____ is a method of approximating cost functions. A. Transaction analysis B. Cost driver analysis C. Product analysis D. Account analysis 28) _____ is a name for a system that first accumulates overhead costs for each of the activities of an organization, and then assigns the costs of activities to the products, services, or other cost objects that caused that activity. A. Cost driver accounting B. Activity based costing C. Transaction based accounting D. Transaction costing 29) _____ need cost accounting systems. A. Service organizations and nonprofit organizations B. Manufacturing firms and service organizations C. Manufacturing firms and nonprofit organizations D. Manufacturing firms, service organizations, and nonprofit organizations 30) The change from traditional costing to activity-based costing may reveal that _____. A. low volume products are overcosted B. high volume products are overcosted C. both high and low volume products are overcosted D. both high and low volume products are undercosted 31) _____ budgeting is when budgets are formulated with the active participation of all affected employees A. Team B. Financial C. Participative D. Shared 32) _____ models are mathematical models of the master budget that can react to any set of assumption about sales, costs, and product mix. A. Financial planning B. Budgeting analysis C. Accounting D. Futuring 33) A _____ gives the expected sales under a given set of conditions. A. sales budget B. sales prediction C. budget forecast D. sales forecast 34) Unit sales of Product A are currently 10,000, while unit sales of Product B are double those of Product A. The com¬pany's sales forecast will be _____, assuming sales of Product A increase by 10% and those of Product B increase by 4,000 units. A. 11,000 and 22,000 units, respectively B. 10,000 and 20,000 units, respectively C. 11,000 and 24,000 units, respectively D. none of these answers is correct 35) A _____ gives the expected sales under a given set of conditions. A. sales budget B. sales prediction C. budget forecast D. sales forecast 36) The master budget includes forecasts for all of the following except _____. A. number of employees B. sales C. balance sheets D. cash disbursements 37) The master budget quantifies targets for all of the following except _____. A. production B. sales C. markets D. cost driver activity 38) Which of the following statements is false? A. Flexible budgets are not based on the same revenue and cost behavior assumptions as the static budget. B. Flexible budgets help provide a basis for management by exception. C. Flexible budgets are prepared for a range of activity. D. Flexible budgets are automatically matched to changes in activity levels 39) Differences between the static budget and the flexible budget are due to _____. A. poor usage of material and labor B. problems of cost control C. a combination of price and material variances D. actual activity differing from expected activity levels  |
