Management Accounting) If fixed production costs are not allocated to manufactured products, this conveys the idea that ________. A) fixed costs are not necessary to manufacture a product. B) fixed costs are necessary to manufacture a product. C) variable costs are less important than fixed costs to manufacture a product. D) fixed costs are more important than variable costs to manufacture a product.

Management Accounting) If fixed production costs are not allocated to manufactured products, this conveys the idea that ________. A) fixed costs are not necessary to manufacture a product. B) fixed costs are necessary to manufacture a product. C) variable costs are less important than fixed costs to manufacture a product. D) fixed costs are more important than variable costs to manufacture a product.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter7: Variable Costing For Management analysis

Section: Chapter Questions

Problem 10DQ: Explain why service companies use different activity bases than manufacturing companies to classify...

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Explain why service companies use different activity bases than manufacturing companies to classify costs as fixed or variable.
Overhead costs are the source of product cost distortions. Do you agree or disagree? Explain.
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(Management Accounting) In make-or-buy decisions for a part for a product, relevant costs include ________. A) some variable costs of making the part B) all variable costs of making the part C) fixed costs that can be avoided in the future if the part is purchased D) B and C
Indirect cost is the cost that cannot be directly attributed to the production as these costs are incurred in general and can be fixed or variable in future. True or false
Which of the following statements is false? Multiple Choice Examples of selling costs include shipping, sales commissions, and costs of finished goods warehouses. Discretionary fixed costs may be altered in the short term by current managerial decisions. A particular cost may be direct or indirect depending on the cost object. All sunk costs should be ignored in making a decision. Some of the conversion costs are period costs.
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How do fixed costs create difficulties in costing units of product? please explain in details.
Which of the following statements regarding activity-based costing (ABC) is false? A. ABC is not an appropriate tool for analysing non-manufacturing costs. B. ABC can be used to analyse the profitability of customers. C. ABC evolved as a response to problems with traditional costing systems. D. ABC can be used to measure the cost of cost objects.
A downside to absorption costing is: a) not including fixed manufacturing overhead in the cost of the product b) that it is not really useful for managerial decisions c) that it is not allowable under GAAP d) that it is not well designed for cost-volume-profit analysis