Question : 56.Plans that identify costs and expenses under each manager’s control : 1258716

56.Plans that identify costs and expenses under each manager’s control prior to the reporting period, typically based on the flexible budget approach, are called:   

A. Cost accounting systems.

B. Managerial accounting systems.

C. Responsibility accounting systems.

D. Responsibility accounting budgets.

E. Activity-based accounting systems.

57.Within an organizational structure, the person most likely to be evaluated in terms of controllable costs would be:   

A. A payroll clerk.

B. A cost center manager.

C. A production line worker.

D. A maintenance worker.

E. A sales representative.

58.The most useful data for evaluation of a manager’s cost performance is based on:   

A. Controllable costs.

B. Contribution percentages.

C. Departmental contributions to overhead.

D. Uncontrollable expenses.

E. Direct costs.

59.In a responsibility accounting system:   

A. Managers are responsible for their departments’ controllable costs.

B. Each accounting report contains all items allocated to a responsibility center.

C. Organized and clear lines of authority and responsibility are only incidental.

D. All managers at a given level have equal authority and responsibility.

E. Outputs of the departments are not part of the evaluation process.

60.Responsibility accounting performance reports:   

A. Become more detailed at higher levels of management.

B. Are usually summarized at higher levels of management.

C. Are equally detailed at all levels of management.

D. Are useful in any format.

E. Are irrelevant at the highest level of management.

61.A responsibility accounting performance report displays:   

A. Only actual costs.

B. Only budgeted costs.

C. Both actual costs and budgeted costs.

D. Only direct costs.

E. Only indirect costs.

62.Which of the following is not true regarding a responsibility accounting system?   

A. It is designed to measure the performance of managers in terms of controllable costs.

B. It assigns responsibility for costs to the appropriate managerial level that controls those costs.

C. It should not hold a manager responsible for costs over which the manager has no influence.

D. It can be applied at any level of an organization.

E. It is only relevant in manufacturing companies.

63.A cost incurred to produce or purchase two or more products at the same time is a(n):   

A. Product cost.

B. Incremental cost.

C. Differential cost.

D. Joint cost.

E. Fixed cost.

64.In regard to joint cost allocation, the “split-off point” is:   

A. A physical basis method to allocate costs based on ratio of some physical characteristic.

B. The difference between the actual and market value of joint costs.

C. The point at which some products are sold and some remain in inventory.

D. The point at which separate products can be identified.

E. Not acceptable when using the value basis for allocating joint costs.

65.Allocating joint costs to products using a value basis method is based on their relative:   

A. Sales values.

B. Direct costs.

C. Gross margins.

D. Total costs.

E. Variable costs.