name for a system that first accumulates overhead costs for each of the activities of an organization, and then assigns the costs of activities to the products, services, or other cost objects that caused that activity
25) _____ of approximating cost functions does not involve the analysis of past costs.
A. Visual fit analysis
B. Engineering analysis
C. High low analysis
D. least-squares regression
26) Managers should apply two principles to obtain accurate and useful cost functions. These principles are ____.
A. plausibility and reliability
B. reliability and validity
C. plausibility and believability
D. believability and validity
27) In relation to a cost function, the term reliability means_____.
A. whether the cost function conforms to a given mathematical model
B. how well the cost function predicts future costs
C. whether the costs and activities can be easily observed
D. how well the cost function explains past cost behavior
28) _____ is a name for a system that first accumulates overhead costs for each of the activities of an organization, and then assigns the costs of activities to the products, services, or other cost objects that caused that activity.
A. Cost driver accounting
B. Activity based costing
C. Transaction costing
D. Transaction based accounting
29) _____ need cost accounting systems.
A. Service organizations and nonprofit organizations
B. Manufacturing firms and service organizations
C. Manufacturing firms, service organizations, and nonprofit organizations
D. Manufacturing firms and nonprofit organizations
30) _____ is an example of the external financial reporting purpose of the cost management systems.
A. The product mix to optimize profitability
B. The cost of a manufacturing process
C. Budget reporting
D. The amount of inventory that should appear on the balance sheet
31) A sales forecast is _____.
A. the result of decisions to create conditions
B. a prediction of sales under a given set of conditions
C. all of these answers are correct
D. the same as a sales budget that will generate a desired level of sales
32) _____ budgeting is when budgets are formulated with the active participation of all affected employees
33) A _____ gives the expected sales under a given set of conditions.
A. sales budget
B. sales prediction
C. sales forecast
D. budget forecast
34) Unit sales of Product A are currently 10,000, while unit sales of Product B are double those of Product A. The com¬pany’s sales forecast will be _____, assuming sales of Product A increase by 10% and those of Product B increase by 4,000 units.
A. 11,000 and 22,000 units, respectively
B. none of these answers is correct
C. 11,000 and 24,000 units, respectively
D. 10,000 and 20,000 units, respectively
35) The master budget includes forecasts for all of the following except _____.
A. number of employees
B. cash disbursements
C. balance sheets