product constraints
emphasis of a product line
product mix
product price
2) Which of the following is not a factory overhead allocation method?
single plantwide rate
factory costing
multiple departmental rates
activity-based costing
3) Everest Co. uses a plantwide factory overhead rate based on direct labor hours. Overhead costs would be overcharged to which of the following departments?
A labor-intensive department
A capital-intensive department
A materials-intensive department
All of these choices are correct.
4) Common allocation bases are
direct labor dollars, direct labor hours, machine dollars
machine dollars, direct labor dollars, direct labor hours
direct labor dollars, direct labor hours, direct material dollars
direct labor dollars, direct labor hours, machine hours
5) Using multiple department factory overhead rates instead of a single plantwide factory overhead rate:
applies overhead costs to all departments equally
is simpler and less expensive to compute than a plantwide rate
results in more accurate product costs
results in distorted product costs
6) Using a plantwide factory overhead rate distorts product costs when:
products require different ratios of allocation-base usage in each production department
neither “products require different ratios of allocation-base usage in each production department” nor “significant differences exist in the factory overhead rates used across different production departments” are true
both “products require different ratios of allocation-base usage in each production department” and “significant differences exist in the factory overhead rates used across different production departments” are true
significant differences exist in the factory overhead rates used across different production departments
7) All of the following can be used as an allocation base for calculating factory overhead rates except:
direct labor hours
direct labor dollars
machine hours
total units produced
8) Which of the following are the two most common allocation bases for factory overhead?
Total overhead dollars and machine hours
Direct labor hours and machine hours
Machine hours and factory expenses
Direct labor hours and factory expenses
9) Which of the following is a cost pool used with the activity-based costing method?
total selling and administrative overheads
direct material dollars
production setups
total factory overheads
10 ) Shubelik Company is changing to an activity-based costing method. They have determined that they will use three cost pools: setups, inspections, and assembly. Which of the following would not be used as the activity base for any of these three activities?
a.number of units to be produced
b.number of inspections
c.number of direct labor hours
d.number of setups+
