ACC 310 Week 4 Quiz

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Yellow Industries decides to price delivery service according to the results of a recent activity-based costing (ABC) study. The study indicates Yellow should charge $8 per order, 2% of the order’s value for general delivery costs, $1.25 per item, and $30 for delivery.

A year later, Yellow collected the following information for two of its best customers:

Which of the following items would be classified as a volume-level cost in an activity-based cost management (ABM) system?

Pardee Company makes 30% of its sales for cash and 70% on account. 60% of the account sales are collected in the month of sale, 25% in the month following sale, and 12% in the second month following sale. The remainder is uncollectible. The following information has been gathered for the current year:

The Waverly Company has budgeted sales for the year 2008 as follows:

Which of the following service department cost allocation methods is most widely used by manufacturing companies?

The controllability concept states that managers should be held responsible for

Which of the following service departments would use space occupied (square footage) to allocate its costs to user departments?

Which of the following activities is most likely to be classified as value-added for a manufacturing company?

Which of the following is not a characteristic of a decentralized organization?

Which of the following items would be classified as a batch-level cost in an activity-based cost management (ABM) system?