1. Gundy Press reports the following information about resources. At the beginning of the year, Gundy estimated it would spend $42,000 for setups and $21,000 for clerical.
Cost Driver Rate
Cost Driver Volume
Resources used
Setups
$250
175 runs
Clerical
30
500 pages typed
Resources supplied
Setups
$45,000
Clerical
20,000
Compute unused resource capacity for clerical for Gundy Press.
2. An operating unit that is responsible for revenues and costs is commonly referred to as a(n)
3. Beta Company is preparing its annual profit plan. As part of its analysis of the profitability of its customers, management estimates that the $12,000 for sales support should be assigned to the individual customers from the information given as follows:
Customer A
Customer B
Units purchased
100,000
200,000
Purchase orders (annual)
5
20
What is the amount of the sales support costs that should be allocated to Customer A assuming Beta uses activity-based costing (ABC)?
4. Gundy Press reports the following information about resources. At the beginning of the year, Gundy estimated it would spend $42,000 for setups and $21,000 for clerical.
Cost Driver Rate
Cost Driver Volume
Resources used
Setups
$250
175 runs
Clerical
30
500 pages typed
Resources supplied
Setups
$45,000
Clerical
20,000
Compute unused resource capacity for setups for Gundy Press.
5. The amount of resources used in an activity-based costing (ABC) system for a specific activity is computed by multiplying the:
6. The Waverly Company has budgeted sales for the year 2008 as follows:
Quarter
1
2
3
4
Sales in units
12,000
14,000
18,000
16,000
The ending inventory of finished goods for each quarter should equal 25% of the next quarter’s budgeted sales in units. The finished goods inventory at the start of the year is 3,000 units. Scheduled production for the second quarter is (in units)
7. Which of the following is not an example of a prevention cost?
8. Which of the following activities is most likely to be classified as value-added for a manufacturing company?
9. Long-range planning as a management function is more important
10. The controllability concept states that managers should be held responsible forN
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