2022年ALLOCATIONOFSUPPORTDEPARTMENTCOSTS.docx

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1、名师归纳总结 精品学习资料 - - - - - - - - - - - - - - -ALLOCATION OF SUPPORT DEPARTMENT COSTS, COMMON COSTS, AND REVENUES TRUE/FALSE 1. The dual cost-allocation method classifies costs into two pools, a budgeted cost pool and an actual cost pool. Answer: False Difficulty : 1 Objective: 1 Terms to Learn: dual-ra

2、te cost-allocation method The dual cost-allocation method classifies costs into two pools, a variable cost pool and a fixed cost pool. 2. Using the single-rate method transforms the fixed costs per hour into a variable cost to users of that facility. Answer: True Difficulty : 3 Objective: 1 Terms to

3、 Learn: single-rate cost-allocation method 3. The single-rate cost-allocation method provides better information for decision making than the dual-rate method. Answer: Terms to Learn: method False Difficulty : 2 Objective: 1 single-rate cost-allocation method, dual-rate cost-allocation The dual-rate

4、 cost-allocation method provides better information for decision making than the single-rate method. 4. An advantage of the single-rate method is that it is easier and always the most accurate cost-allocation choice. Answer: False Difficulty : 2 Objective: 1 Terms to Learn: single-rate method The si

5、ngle-rate method is the easiest cost allocation method, but it is the least accurate cost-allocation choice. 细心整理归纳 精选学习资料 - - - - - - - - - - - - - - - 第 1 页,共 13 页 - - - - - - - - - 名师归纳总结 精品学习资料 - - - - - - - - - - - - - - -5. When budgeted cost-allocation rates are used, user-division managers f

6、ace uncertainty about the allocation rates for that budget period. Answer: False Difficulty : 2 Objective: 2 Terms to Learn: single-rate cost-allocation method, dual-rate cost-allocation method When budgeted cost-allocation rates are used, user-division managers face uncertainty about the allocation

7、 rates for that budget period. 6. When budgeted cost-allocation rates are used, managers of the supplier division are motivated to improve efficiency. Answer: True Difficulty : 2 Objective: 2 Terms to Learn: single-rate cost-allocation method, dual-rate cost-allocation method 7. When budgeted cost-a

8、llocation rates are used, variations in actual usage by one division affect the costs allocated to other divisions. Answer: False Difficulty : 2 Objective: 2 Terms to Learn: single-rate cost-allocation method, dual-rate cost-allocation method When actual cost-allocations rates are used, variations i

9、n actual usage by one division affect the costs allocated to other divisions. 8. The only choices that a firm has for support department cost allocation rates are to use either a budgeted rate or an actual rate. Answer: False Difficulty : 2 Objective: 2 Terms to Learn: single-rate method, dual-rate

10、method The choices a firm has for support department cost allocation rates include using a budgeted rate, an actual rate, or some negotiated rate. 9. The direct allocation method highlights recognition of services rendered by support departments to other support departments. Answer: False Difficulty

11、 : 2 Objective: 3 Terms to Learn: direct allocation method The direct allocation method allows for no recognition of services rendered by support departments to other support departments. 10. The reciprocal allocation method incorporates mutual services provided among all support departments. 细心整理归纳

12、 精选学习资料 - - - - - - - - - - - - - - - 第 2 页,共 13 页 - - - - - - - - - 名师归纳总结 精品学习资料 - - - - - - - - - - - - - - -Answer: True Difficulty : 2 Objective: 3 Terms to Learn: reciprocal allocation method 11. Budgeted amounts for a support department will always exceed complete reciprocated costs for that

13、department. Answer: False Difficulty : 3 Objective: 3 Terms to Learn: complete reciprocated costs, support department Complete reciprocated costs equal budgeted amounts for the support department plus any interdepartmental cost allocations, therefore, complete reciprocated costs always exceed budget

14、ed amounts. 12. The direct allocation method provides key information for outsourcing decisions regarding support services. Answer: False Difficulty : 3 Objective: 3 Terms to Learn: support department, direct allocation method Complete reciprocal costs of a support department provide key information

15、 for outsourcing decisions regarding support services. The direct allocation method does not provide this information. 13. The incremental method of allocating common costs often creates the incentive to be the first-ranked user. Answer: False Difficulty : 3 Objective: 3 Terms to Learn: incremental

16、cost-allocation method The incremental method creates a disincentive to be the first-ranked user because the first-ranked user receives the greatest allocation of cost. 14. The direct method allocates each support departments costs to operating departments and to support departments. Answer: False D

17、ifficulty : 2 Objective: 3 Terms to Learn: direct method The direct method allocates each support departments costs to operating departments but not to other support departments. 15. The step-down method allocates support department costs to other support departments and to operating departments in

18、a sequential manner. 细心整理归纳 精选学习资料 Answer: True Difficulty : 2 Objective: 3 第 3 页,共 13 页 Terms to Learn: step-down method - - - - - - - - - - - - - - - - - - - - - - - - 名师归纳总结 精品学习资料 - - - - - - - - - - - - - - -16. The reciprocal method of support department cost allocation is the most precise met

19、hod and therefore is used most often. Answer: False Difficulty : 2 Objective: 3 Terms to Learn: reciprocal method The reciprocal method of support department cost allocation is the most precise method but is not often used due to its relative complexity. 17. The stand-alone method of allocating comm

20、on costs emphasizes fairness and equity among users. Answer: True Difficulty : 2 Objective: 4 Terms to Learn: stand-alone cost-allocation method 18. Under the incremental method, the first incremental user usually receives the highest allocation of the common costs. Answer: False Difficulty : 2 Obje

21、ctive: 4 Terms to Learn: incremental cost-allocation method Under the incremental method of allocating common costs, the primary user receives the highest allocation of the common costs. 19. A common cost is a cost of operating a facility or activity that is shared by two or more users. Answer: True

22、 Difficulty : 2 Objective: 4 Terms to Learn: common cost 20. The stand-alone cost allocation method ranks the individual users of a cost object in order of users most responsible for a common cost and then uses these rankings to allocate the costs among the users. Answer: True Difficulty : 2 Objecti

23、ve: 4 Terms to Learn: stand-alone cost-allocation method MULTIPLE CHOICE 21. The method that allocates costs in each cost pool using the same rate per unit is known as the: 细心整理归纳 精选学习资料 a. incremental cost-allocation method 第 4 页,共 13 页 b. reciprocal cost-allocation method c. single-rate cost alloc

24、ation method d. dual-rate cost-allocation method - - - - - - - - - - - - - - - - - - - - - - - - 名师归纳总结 精品学习资料 - - - - - - - - - - - - - - -Answer: c Difficulty : 2 Objective: 1 Terms to Learn: single-rate cost-allocation method 22. The dual-rate cost-allocation method classifies costs in each cost

25、pool into a: a. budgeted-cost pool and an actual-cost pool b. variable-cost pool and a fixed-cost pool c. used-capacity-cost pool and a practical-capacity-cost pool d. direct-cost pool and a reciprocal-cost pool Answer: b Difficulty : 1 Objective: 1 Terms to Learn: dual-rate cost-allocation method 2

26、3. The single-rate cost-allocation method may base the denominator choice on: a. master-budget capacity utilization 2 Objective: 1 b. normal capacity utilization c. practical capacity d. All of these answers are correct. Answer: d Difficulty : Terms to Learn: single-rate cost-allocation method 细心整理归

27、纳 精选学习资料 - - - - - - - - - - - - - - - 第 5 页,共 13 页 - - - - - - - - - 名师归纳总结 精品学习资料 - - - - - - - - - - - - - - -24. When using the single-rate method, fixed cost allocation may be based on: a. actual usage b. budgeted usage Objective: 1 c. incremental cost allocation d. Either a or b are correct. A

28、nswer: d Difficulty : 1 Terms to Learn: single-rate cost-allocation method 25. Benefits of the single-rate method include: a. b. the low cost of implementation fixed costs that are transformed into variable costs for user decision making c. signals regarding how variable and fixed costs behave diffe

29、rently d. information that leads to outsourcing decisions that benefit the organization as a whole Answer: a Difficulty : 3 Objective: 1 Terms to Learn: single-rate cost-allocation method 26. Benefits of the dual-rate method include: a. variable costs that are transformed into fixed costs for user d

30、ecision making b. the low cost of implementation c. avoidance of expensive analysis for categorizing costs as either fixed or variable d. information that leads to outsourcing decisions that benefit the organization as a whole Answer: d Difficulty : 3 Objective: 1 Terms to Learn: dual-rate cost-allo

31、cation method THE FOLLOWING INFORMATION APPLIES TO QUESTIONS 36 THROUGH 39: The Bonawitz Corporation has a central copying facility. The copying facility has only two users, the Marketing Department and the Operations Department. The following data apply to the coming budget year: Budgeted costs of

32、operating the copying facility for 200,000 to 300,000 copies: Fixed costs per year $30,000 Variable costs 3 cents .03 per copy Budgeted long-run usage in copies per year: 细心整理归纳 精选学习资料 - - - - - - - - - - - - - - - 第 6 页,共 13 页 - - - - - - - - - 名师归纳总结 精品学习资料 - - - - - - - - - - - - - - -Marketing D

33、epartment Operations Department 60,000 copies 190,000 copies Budgeted amounts are used to calculate the allocation rates. Actual usage for the year by the Marketing Department was 40,000 copies and by the Operations Department was 180,000 copies. 27. If a single-rate cost-allocation method is used,

34、what amount of copying facility costs will be budgeted for the Marketing Department. a. $9,000 1 b. $1,800 c. $7,200 d. $8,400 Answer: a Difficulty : 2 Objective: Terms to Learn: single-rate cost-allocation method 60,000/ 60,000 + 190,000 x $30,000 + 60,000 x $0.03 = $9,000 28. If a single-rate cost

35、-allocation method is used, what amount of copying facility costs will be allocated to the Marketing Department. Assume actual usage is used to allocate copying costs. a. $8,400 c Difficulty : 3 Objective: 1 b. $9,000 c. $6,000 d. $4,800 Answer: Terms to Learn: single-rate cost-allocation method 60,

36、000 / 60,000 + 190,000 x $30,000 + 60,000 x $0.03 = $9,000 $9,000/60,000 copies = $0.15 per copy x 40,000 = $6,000 29. If a dual-rate cost-allocation method is used, what amount of copying facility costs will be budgeted for the Operations Department. a. $28,500 a Difficulty : 2 Objective: 1 b. $28,

37、200 c. $30,245 d. $29,945 Answer: Terms to Learn: dual-rate cost-allocation method 190,000 / 60,000 + 190,000 x $30,000 + 190,000 x $0.03 = $28,500 细心整理归纳 精选学习资料 - - - - - - - - - - - - - - - 第 7 页,共 13 页 - - - - - - - - - 名师归纳总结 精品学习资料 - - - - - - - - - - - - - - -30. If a dual-rate cost-allocation

38、 method is used, what amount of copying facility costs will be allocated to the Operations Department. Assume budgeted usage is used to allocate fixed copying costs and actual usage is used to allocate variable copying costs. a. $30,245 b. $29,945 c. $28,500 d. $28,200 Answer: d Difficulty : 3 Objec

39、tive: 1 Terms to Learn: dual-rate cost-allocation method 190,000 / 60,000 + 190,000 x $30,000 + 180,000 x $0.03 = $28,200 THE FOLLOWING INFORMATION APPLIES TO QUESTIONS 31 THROUGH 34: The Borders Corporation operates one central plant that has two divisions, the Flashlight Division and the Night Lig

40、ht Division. The following data apply to the coming budget year: Budgeted costs of operating the plant for 2,000 to 3,000 hours: Fixed operating costs per year $900,000 Variable operating costs $1,200 per hour Budgeted long-run usage per year: Flashlight Division 2,000 hours Night Light Division 500

41、 hours Practical capacity 3,000 hours Assume that practical capacity is used to calculate the allocation rates. Actual usage for the year by the Flashlight Division was 1,400 hours and by the Night Light Division was 600 hours. 31. If a single-rate cost-allocation method is used, what amount of oper

42、ating costs will be budgeted for the Flashlight Division. a. $3,000,000 a Difficulty : 2 Objective: 1 b. $3,120,000 c. $2,280,000 d. $2,820,000 Answer: Terms to Learn: single-rate cost-allocation method 2,000/3,000 x $900,000 + 2,000 x $1,200 = $3,000,000 细心整理归纳 精选学习资料 - - - - - - - - - - - - - - -

43、第 8 页,共 13 页 - - - - - - - - - 名师归纳总结 精品学习资料 - - - - - - - - - - - - - - -32. If a single-rate cost-allocation method is used, what amount of cost will be allocated to the Flashlight Division. Assume actual usage is used to allocate operating costs. a. $2,280,000 d Difficulty : 3 Objective: 1 b. $2,

44、400,000 c. $3,000,000 d. $2,100,000 Answer: Terms to Learn: single-rate cost-allocation method $3,000,000/2,000 x 1,400 = $2,100,000 see calculation for answer to question 40 33. If a dual-rate cost-allocation method is used, what amount of operating costs will be budgeted for the Night Light Division. a. $780,000 c Difficulty : 2 Objective: 1 b. $900,000 c. $750,000 d. $870,000 Answer: Terms to Learn: dual-rate cost-allocation method 500/3,000 x $900,000 + 500 x $1,200 = $750,000 34. If a dual-rate cost-allocation method is used, what amount of cost will be alloca