D.2 Costing Systems

Question 1

TRUE/FALSE: Normal spoilage is allocated btwn cost of goods units completed during the period and ending work-in-process inventory

Answer 1

TRUE

Question 2

The product costing method which considers all costs of developing, producing, and distributing a product (i.e., cradle-to-grave) is called ________ costing.

Answer 2

LIFECYCLE

Question 3

Costs, which would be included in the lifecycle cost but would not be included in the traditional absorption cost of a product, include ________ costs.

Answer 3

DESIGN & DISPOSAL

Question 4

________ specifies the amount of material and labor required, and adds an allocation for overhead.

Answer 4

JOB ORDER COSTING

Question 5

Normal rework is ____ to a specific job

Answer 5

charged

Question 6

A ______ driver is the cost driver that quantifies the resources used in an activity

Answer 6

RESOURCE

Question 7

An ______ driver is the cost driver that quantifies the activity that a cost object consumes

Answer 7

ACTIVITY

Question 8

A ______ ______ is an activity that increases a customer’s perceived value of a product or service

Answer 8

VALUE ADDED ACTIVITY

Question 9

Process costing

Answer 9

USAGE: mass producing products

Question 10

Backflush costing system

Answer 10

Usage: Just in time inventory

What happens: expenses recorded as one entry after production is done rather than during time period it occurs