Reference no: EM13920580

1. How does an ERP system differ from an MIS?

1 The ERP system informally links the different areas of management for specific purposes.
2 There is no difference.
3 The ERP system combines all areas of management into one centralized data warehouse.
4 The ERP system can be used only in a service business.

2. Quality costs of conformance and costs of nonconformance are related to each other:

1 rarely.
2 directly.
3 indirectly.
4 inversely.

3. The overall objective of controlling the costs of quality is to eliminate:

1 appraisal costs.
2 costs of nonconformance.
3 costs of conformance.
4 the costs of quality.

4. Some companies have moved to JIT without changing the substance of their accounting systems. Relying on the former accounting system may present problems for management because:

1 traditional accounting systems are designed to track items (labor efficiency, purchase price, overhead absorption) that are no longer primary concerns of management.
2 control of cost drivers will be lost.
3 managers do not understand the new manufacturing environment.
4 traditional accounting systems discourage the creation of large inventories that are necessary to ensure uninterrupted production runs.

5. With respect to product quality:

1 quality must be "traded off" against cost considerations.
2 the best quality control systems rely on inspection points to ensure product quality.
3 accountants do not need to be concerned with quality control reporting, as it is entirely nonfinancial in nature.
4 quality output starts with correct product design.

6. CAD is:

1 a cost allocating decision.
2 computer aided downtime.
3 a computer-based engineering system.
4 an organizational environment.

7. Which of the following specific measures of vendor quality would be used when evaluating vendors that supply a company with direct materials?

1 Defect-free material as a percentage of total materials received
2 Number of customer complaints
3 Time it takes to make a product
4 All would be considered to assess vendor quality of direct materials

8. The term given to the act of a company comparing its processes to similar processes in a successful company is called:

1 process mapping.
2 TQM.
3 benchmarking.
4 return on quality.

9. The award given to companies that achieve distinctive results in implementing total quality control is the:

1 ISO.
2 Malcolm Baldrige Quality Award.
3 Deming Application Prize.
4 Kaizen Prize.

10. A producing center is another term for a(n):

1 service center.
2 cost center.
3 revenue center.
4 activity center.

11. A discretionary cost center is another term for a(n):

1 service center.
2 activity center.
3 cost center.
4 revenue center.

12. The allocation base used to assign service center costs is called a:

1 service base.
2 cost driver.
3 revenue driver.
4 revenue base.

13. An organization that does not require precise measurements of the use of services probably would allocate its service center costs by:

1 using some form of the step method.
2 applying the direct method.
3 each revenue center's ability to absorb the cost.
4 the actual usage of the service by the revenue centers.

14. Which of the following is a problem inherent in charging revenue centers for usage of service centers?

1 It is difficult to determine the amount that each revenue center should be charged for services.
2 The usage among the revenue centers could vary widely.
3 A particular revenue center may not use any of the support of a specific service center.
4 The revenue centers could choose to use services from outside the company instead.

15. Another name for the simultaneous equation method is the:

1 reciprocal method.
2 two-step method.
3 step down method.
4 indirect method.

16. Which of the following methods allocates each service center's costs to all centers supported?

1 Simultaneous equation method
2 Step method
3 Direct method
4 None of the above

17. Activity-based overhead rates differ from departmental overhead rates in that:

1 they are not used to help determine the full cost of a product or service.
2 they do not include any costs allocated from service centers in their calculation.
3 there are more than one per department.
4 they lessen a manager's ability to control costs.

18. The cost allocation method that assigns joint costs to products based on their relative market value at the split-off point is the:

1 simultaneous equation method.
2 relative sales value method.
3 net realizable value method.
4 physical units method.

19. Joint costs are:

1 incurred prior to the separation of joint products.
2 incurred after separation of joint products.
3 incurred prior and after separation of joint products.
4 None of the above

20. Which of the following is an example of a by-product?

1 Sawdust from a lumber mill used to make fireplace logs
2 Broken cookies used in cookies-and-cream ice cream
3 Pineapple skins from processing pineapple used for animal feed
4 None of the above