Regardless of the system used In departmental cost analysis: Multiple Cholce Total departmental costs will always be the same. Neither direct nor indirect costs are allocated. Indirect costs are allocated, direct costs are not. Direct costs are allocated, indirect costs are not. Both direct and indirect costs are allocated.

Regardless of the system used In departmental cost analysis: Multiple Cholce Total departmental costs will always be the same. Neither direct nor indirect costs are allocated. Indirect costs are allocated, direct costs are not. Direct costs are allocated, indirect costs are not. Both direct and indirect costs are allocated.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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For joint cost allocation: only the net realizable method can be used to allocate joint costs to by-products. only the relative sales value method can be used to allocate joint costs to scrap. separable costs do not include disposal costs. no joint costs are allocated to by-products or scrap. the most accurate method is the one using physical measures of output.
Which of the following is TRUE regarding the total service department cost allocated by the three recognized allocation method? O The reciprocal method results in the highest amount of total cost being allocated to operating departments as it recognizes all possible interactions among the support departments prior to allocation. O The answer will depend on how many service departments are involved in supporting operating departments. O The step method results in more total cost being allocated to operating departments than the direct method as it recognizes at least some portion of interactions among the support departments. O There is no difference among the three methods in terms of total cost being allocated to operating departments. blout
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Explain departmental income statement and the criterion for division of indirect costs among departments. Provide a hypothetical example in which at least 3 indirect costs are divided among departments.
Explain the difference between the cost classifications, ‘production prime costs’ and ‘indirect production overheads’, and discuss the cost accounting applications of the differences used for traditional absorption costing purposes [dont give chatgpt answer]
Organizations are motivated to use multiple indirect cost pools instead of a single indirect cost pool when Select one: O a. Multiple Indirect cost pools are needed to conform to external reporting requirements b. manufacturing overhead costs are difficult to control c. the cost drivers for the multiple indirect cost pools are different from the cost driver of the single indirect cost pool d. none of the options
A department’s profit is equal to a. the department's revenue less divisional variable costs. b. the department’s revenue less their share of corporate costs only. c. the department’s revenue less divisional variable costs and less investment costs. d. the department’s revenue less divisional variable and less their share of corporate costs.
Allocating costs for joint products can be done by: a. Sales Value Approach b. Contribution Margin Approach C. All Approaches are correct. d. Comparative Income Approach
All service department costs are costs as far as the product is concern because they do not arisefrom production activities.a. directb. indirectc. variabled. fixed
How to allocate indirect costs to multiple departments using an ABC cost driver?
Which of the following is the most commonly used method for assignment of joint costs? a. Relative sales value b. Split-off method c. Average production cost d. Relative percentage of direct costs basis