Chapter 22 Quiz Multiple Choices ACCT 2302 Managerial Accounting

1)

A single cost incurred in producing or purchasing two or more essentially different products is a(n):

[removed]Product cost.[removed]Incremental cost.[removed]Differential cost.[removed]Joint cost.[removed]Fixed cost.2)Which of the following is an example of a financial performance measure that would be found in a balanced scorecard?[removed]Percentage of sales from new customers.[removed]Money spent on employee training programs.[removed]Product costs.[removed]Return on investment.[removed]Money spent on research and development.MC Qu. 85 Ice House Industries, Inc. has three …Ice House Industries, Inc. has three operating departments: Cooking, Churning, and Freezing. Indirect factory costs for the current period were Administrative $560,000 and Maintenance $98,000. Administrative costs are allocated to operating departments based on the number of workers and maintenance costs are allocated to operating departments based on square footage occupied.  Based on the above data, determine the maintenance cost allocated to each operating department of Ice House Industries, Inc.  [removed]Option A[removed]Option B[removed]Option C[removed]Option D[removed]Option E4)Bevo Beef Company uses the relative market value method of allocating joint costs in their production of beef products. Relevant information for the current period follows:  The total joint cost for the current period was $43,000. How much of this cost should Bevo Beef allocate to sirloin?  [removed]$0[removed]$5,909[removed]$8,600[removed]$10,750[removed]$43,000A department that incurs costs without directly generating revenues is a:[removed]Service center.[removed]Production center.[removed]Profit center.[removed]Cost center.[removed]Performance center.    Fred Smith and Joe Barney are managers of two product lines for Quarry Company. One of them is a candidate for promotion based on performance. Using the data above, which of the following is a true statement?[removed]Smith is outperforming Barney as measured by return on investment center assets.[removed]Barney is outperforming Smith as measured by return on investment center assets.[removed]The return in investment center assets is the same for both.[removed]If target performance is a 7% return on assets, both investment centers are performing above the target level.[removed]If target performance is a 7% return on assets, the residual income for both centers is positive.  Joint products A and B are produced in a single operation from Material M. Three hundred gallons of Material M, costing $450, produced 200 gallons of Product A, selling for $2 per gallon, and 100 gallons of Product B, selling for $6 per gallon.If the $450 cost of the 300 gallons of Material M were to be allocated to the joint products in proportion to the number of gallons of each product produced, Product A’s share would be:[removed]$0[removed]$180[removed]$225[removed]$300[removed]$450 An accounting system that provides information that management can use to evaluate the performance of a department’s manager is called a:[removed]Cost accounting system.[removed]Managerial accounting system.[removed]Responsibility accounting system.[removed]Financial accounting system.[removed]Activity-based accounting system. A company has two departments, Aa and Bb, that incur delivery expenses. An analysis of the total delivery expense of $9,000 indicates that Dept. Aa had a direct expense of $1,000 for deliveries. None of the $9,000 is a direct expense to Dept. Bb. The analysis also indicates that 60% of regular delivery requests originate in Dept. Aa and 40% in Dept. Bb. The delivery expenses that should be charged to Dept. Aa and Dept. Bb, respectively, are:  [removed]Option A[removed]Option B[removed]Option C[removed]Option D[removed]Option E Which of the following is most likely to be considered a profit center?[removed]An individual retail store in a large chain.[removed]The grocery department of a Walmart Supercenter or Target Superstore.[removed]The maintenance department of a large retail operation.[removed]The personnel office of a business.[removed]A stand-alone eye clinic.