Costing Systems
What is the main goal of refined costing systems like ABC?
What is to reduce cost distortion?
What is the first step in allocating MOH using ABC?
What is identifying primary activities and estimating MOH costs for each activity?
What does Activity-Based Management (ABM) use ABC for?
What is to make decisions?
Name one of the four categories of the costs of quality.
What is prevention, appraisal, internal failure, or external failure?
What is the goal of Total Quality Management (TQM)?
What is to consistently generate high quality goods/services?
What is the definition of cost distortion?
What is when some products are overcosted while others are undercosted?
What is the third step in allocating MOH using ABC?
What is dividing the estimated MOH cost pool by the estimated allocation base?
Which type of companies would benefit most from implementing ABC/ABM?
What is companies in competitive markets?
What type of cost is quality training?
What is a prevention cost?
Which method of cost allocation uses separate rates for each activity?
What is ABC (Activity-Based Costing)?
What is considered to be the most refined and accurate costing system?
What is Activity-Based Costing (ABC)?
How is the allocation rate determined in ABC for each activity?
What is by dividing estimated MOH cost pool for each activity by the estimated allocation base for each activity?
When are the benefits of using ABC/ABM higher?
What is in companies with a high risk of cost distortion?
What are appraisal costs related to?
What is costs to detect poor-quality goods?
What is the result of a re-engineered production process on a cost system?
What is that a cost system is outdated?
What is the primary issue with the plantwide method of allocating manufacturing overhead (MOH)?
What is it causes cost distortion?
In ABC, how are Direct Materials (DM) handled?
What is traced directly to the cost object?
What is one sign that an old system may be distorting costs?
What is when managers do not understand costs and profits?
Which category of quality costs includes costs to fix or rework poor-quality goods?
What is internal failure costs?
What is one of the reasons that a company might have a high risk of cost distortion?
What is they produce many different types of products?
In Activity-Based Costing (ABC), how is manufacturing overhead (MOH) allocated?
What is allocated based on specific activities?
What is the fourth and final step in allocating MOH using ABC?
What is multiply each rate by the actual allocation base for that activity, and add all the activities' allocations together?
What is one sign that the old cost system is outdated?
What is when there has been a re-engineered production process?
What are external failure costs?
What is costs related to poor-quality goods after delivery to the customer?
When should companies use Activity-Based Costing?
What is when they have low volumes of many products and high volumes of some products?