Bus 475 Final Exam

BUS 475 FINAL EXAM

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BUS 475 FINAL EXAM,

1) A well-designed activity-based costing system starts with __________.

A. analyzing the activities performed to manufacture a product

B. assigning manufacturing overhead costs for each activity cost pool to products

C. computing the activity-based overhead rate

D. identifying the activity-cost pools

2) “Generally accepted” in the phrase generally accepted accounting principles means that the principles __________.

A. have been approved for use by the managements of business firms

B. have been approved by the Internal Revenue Service

C. have substantial authoritative support

D. are proven theories of accounting

3) The income statement and balance sheet columns of Pine Company’s worksheet reflects the following totals:

Income Statement Balance Sheet

Dr. Cr. Dr. Cr.

Totals $58,000 $48,000 $34,000 $44,000

The net income (or loss) for the period is __________.

A. not determinable

B. $10,000 loss

C. $10,000 income

D. $48,000 income

4) These are selected account balances on December 31, 2008.

Land (location of the corporation’s office building) $150,000

Land (held for future use) 225,000

Corporate Office Building 900,000

Inventory 300,000

Equipment 675,000

Office Furniture 150,000

Accumulated Depreciation 450,000

What is the net amount of property, plant, and equipment that will appear on the balance sheet?

A. $1,425,000

B. $1,950,000

C. $2,400,000

D. $1,650,000

5) The first step in activity-based costing is to __________.

A. identify the cost driver that has a strong correlation to the activity cost pool

B. assign manufacturing overhead costs for each activity cost pool to products

C. identify and classify the major activities involved in the manufacture of specific products

D. compute the activity-based overhead rate per cost driver...