S1: Abnormal spoilage is considered a period cost. S2: Backflush costing requires fewer allocations than traditional accounting methods. S3: Lean manufacturing and just-in-time (JIT) systems are both concerned with reduction of inventory levels. Group of answer choices True; False; False True; True; False False; True; True False; False; True False; False; False True; True; True

S1: Abnormal spoilage is considered a period cost. S2: Backflush costing requires fewer allocations than traditional accounting methods. S3: Lean manufacturing and just-in-time (JIT) systems are both concerned with reduction of inventory levels. Group of answer choices True; False; False True; True; False False; True; True False; False; True False; False; False True; True; True

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Description: S1: Abnormal spoilage is considered a period cost.S2: Backflush costing requires fewer allocations than traditional accounting methods.S3: Lean manufacturing and just-in-time (JIT) systems are both concerned with reduction of inventory levels.Group o

Accounting Information Systems

10th Edition

ISBN:9781337619202

Author:Hall, James A.

Publisher:Hall, James A.

Chapter7: The Conversion Cycle

Section: Chapter Questions

Problem 9MCQ: Which of the following statements regarding traditional accounting is true? a. Traditional...

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Wrong allocation of common costs lead to A. Inaccurate estimation of cost of products or services B. Under utilization of capacity C. Lower profit margin D. All of the above are correct
A disadvantage of absorption costing is A.) None of the answers are correct. B.) Both answers are correct. C.) That it is not useful in management's decision-making process. D.) That it might encourage inventory buildup when there is no demand. Please dont give plagiarised answers and give best explanation
Which of the following is NOT a problem associated with standard cost accounting? a. Standard costing motivates management to produce large batches of products and build inventory. b. Applying standard costing leads to product cost distortions in a lean environment. c. Standard costing data are associated with excessive time lags that reduce its usefulness. d. The financial orientation of standard costing may promote bad decisions. e. All of the above are problems with standard costing.
Why is variable costing not in compliance with generally accepted accounting principles?a. Fixed manufacturing costs are assumed to be period costs.b. Variable costing procedures are not well known in industry.c. Net earnings are always overstated when using variable costing.d. Variable costing ignores the concept of lower of cost or market when valuing inventory.
Absorption costing is:A. a good way to value inventories for the balance sheet.B. used for external reporting purposes.C. less useful than variable costing for management decision making. D. A and B is correct E. A, B and C is correct
When inventories are decreasing, _________ costing will lead to lower profits because ______________: a. Variable; overheads are expensed to profits during the year b. Variable; overheads are retained in inventory values c. None of the available options is correct d. Absorption; capitalised overheads are retained in inventory values e. Absorption; capitalised overheads are released to profit during the year
Identify if true or false When inventory decreases, the net operating income under absorption costing is ALWAYS lower than of variable costing. When inventory decreases the fixed manufacturing overhead is deferred in inventory. The change in production does not affect net operating income under variable costing system. *
First: The inventory value shown on the balance sheet is generally higher under absorption costing than under variable costing. Second: Under variable costing, inventoriable product costs consist of direct materials, direct labor, variable manufacturing overhead and variable selling and administration expenses. * a. Both statements are true b. Only the first statement is true c. Only the second statement is true d. Both statements are false
6. All of the following are reasons to use backflush costing, except Managers tend to use their limited resources on developing more accurate product cost data. Complex ledger systems may be too costly to develop under traditional cost tracking systems. Accuracy is critical when allocating accurate conversion cost per unit. A fairly rough allocation may be sufficient for external reporting a. с. d. purposes. b.
all of the following are reasons to use backflush costing, except a. Managers tend to use their limited resources on developing more accurate product cost data. b. Complex Ledger systems may be too costly to develop under traditional cost tracking systems. c. Accuracy is critical whem allocationg accurate conversion cost per unit. d. A fairly rough allocation may be sufficient for external reporting purposes.
Which of the following statements regarding traditional accounting is true? a. Traditional accounting does not provide managers in a JIT setting with timely information. b. The financial orientation allows for effective measuring disparate items. c. Overhead allocations may lead to cost distortions. d. All of the above are true statements. e. A and C are true, but B is not true.
1. Why are indirect costs not directly traced to cost objects in the same way as direct costs? 2. Define cost tracing, cost allocation, allocation base and cost driver. 3. Distinguish between arbitrary and cause-and-effect allocations. 4. Explain how cost information differs for profit measurement/inventory valuation requirements compared with decision-making requirements. 5. Explain why cost systems should differ in terms of their level of sophistication.