Question : 81.Franklin Manufacturing manufactures two models of windows, bay windows and : 1257135

 

 

81.Franklin Manufacturing manufactures two models of windows, bay windows and casement windows. Franklin uses an activity based costing system. The following information about the activities used to product the company’s products has been provided.  The amount of batch-level cost that should be allocated to the bay windows equals:   

A. $30,000.

 

B. $45,000.

 

C. $75,000.

 

D. $7,500.

 

 

82.Franklin Manufacturing manufactures two models of windows, bay windows and casement windows. Franklin uses an activity based costing system. The following information about the activities used to product the company’s products has been provided.  The amount of product-level cost that should be allocated to the casement windows equals:   

A. $13,125.

 

B. $21,875.

 

C. $30,000.

 

D. $45,000.

 

 

83.Franklin Manufacturing manufactures two models of windows, bay windows and casement windows. Franklin uses an activity based costing system. The following information about the activities used to product the company’s products has been provided.  If bay windows and casement windows require the same amount of direct labor, using labor hours as the allocation base for facility-level costs would:   

A. undercost the casement windows.

 

B. overcost the bay windows.

 

C. undercost both the bay windows and casement windows.

 

D. None of these answers is correct.

 

 

84.Franklin Manufacturing manufactures two models of windows, bay windows and casement windows. Franklin uses an activity based costing system. The following information about the activities used to product the company’s products has been provided.  Which of the following best describes the impact of undercosting?   

A. This is a goal of all companies. Undercosting all products allows for larger profit margins.

 

B. Companies will use target pricing to undercost products.

 

C. Undercosting some products will lead to overcosting other products which may become overpriced and lose market share.

 

D. Undercosting some products can lead to overcosting other products, which is acceptable because it all balances.

 

 

85.An activity center:   

A. is an organizational structure where companies are organized into related activities and the overhead costs associated with performing these activities are combined into cost pools.

 

B. combines overhead costs into cost pools.

 

C. is an organizational structure associated with minimal record-keeping tasks.

 

D. None of these answers is correct.

 

 

86.Which of the following statements is false regarding upstream and downstream costs?   

A. Both upstream and downstream costs are unnecessary and, should be minimized if not eliminated.

 

B. Upstream costs occur before and downstream costs occur after goods are manufactured.

 

C. Product design is an example of an upstream cost.

 

D. Customer service is an example of a downstream cost.

 

 

87.The objective of using the following graph is to:     

A. minimize quality.

 

B. maximize profit.

 

C. minimize total quality costs.

 

D. maximize total quality costs.

 

 

88.Activities that support specific products or product lines are known as:   

A. facility-level activities

 

B. unit-level activities

 

C. product-level activities

 

D. batch-level activities

 

 

89.All of the following quality costs are directly controllable by management except?   

A. Repair and rework

 

B. Product design

 

C. Training costs

 

D. Reliability testing