1.The EOQ model is most relevant for which one of the following?. Single choice.

(1 Point)
A. ordering items with dependent demand
B. determination of safety stock
C. ordering perishable items
D. determining fixed interval order quantities
E. determining fixed order quantities
2.Which is not a true assumption in the EOQ model?. Single choice.
(1 Point)
A. Production rate is constant
B. Lead time doesn't vary
C. No more than 3 items are involved
D. Usage rate is constant
E. No quantity discounts
3.In a supermarket, a vendor's restocking the shelves every Monday morning is
an example of:. Single choice.
(1 Point)
A. safety stock replenishment
B. economic order quantities
C. reorder points
D. fixed order interval
E. blanket ordering
4.A risk avoider would want ______ safety stock.. Single choice.
(1 Point)
A. Less
B. More
C. The same
D. Zero
E. 50%
5.In the basic EOQ model, if lead time increases from five to 10 days, the EOQ
will:. Single choice.
(1 Point)
 A. double
B. increase, but not double
C. decrease by a factor of two
D. remain the same
E. none of the above
6.. Which of the following is not true for Economic Production Quantity model?.
Single choice.
(1 Point)
A. Usage rate is constant.
B. Production rate exceeds usage rate.
C. Run size exceeds maximum inventory.
D. There are no ordering or setup costs.
E. Average inventory is one-half maximum inventory.
7.The introduction of quantity discounts will cause the optimum order quantity to
be: The introduction of quantity discounts will cause the optimum order quantity
to be:. Single choice.
(1 Point)
A. smaller
B. unchanged
C. greater
D. smaller or unchanged
E. unchanged or greater
8.A fill rate is the percentage of _____ filled by stock on hand.. Single choice.
(1 Point)
A. Shipments
B. Demand
C. Inventory
D. Safety stock
E. Lead time
9.. Which one of the following is not generally a determinant of the reorder
point?. Single choice.
(1 Point)
A. rate of demand
 B. length of lead time
C. lead time variability
D. stockout risk
E. purchase cost
10. All of the following are possible reasons for using the fixed order interval
model except:. Single choice.
(1 Point)
A. Supplier policy encourages use.
B. Grouping orders can save in shipping costs.
C. The required safety stock is lower than with an EOQ/ROP model.
D. It is suited to periodic checks of inventory levels rather than continuous monitoring.
E. Continuous monitoring is not practical.
11..The management of supply chain inventories focuses on:. Single choice.
(1 Point)
A. internal inventories
B. external inventories
C. both internal and external inventories
D. safety stock elimination
E. optimizing reorder points
12.An operations strategy for inventory management should work towards:.
Single choice.
(1 Point)
A. increasing lot sizes
B. decreasing lot sizes
C. increasing safety stocks
D. decreasing service levels
E. increasing order quantities
13.An operations strategy which recognizes high carrying costs and reduces
ordering costs will result in:. Single choice.
(1 Point)
A. unchanged order quantities
B. slightly decreased order quantities
C. greatly decreased order quantities
 D. slightly increased order quantities
E. greatly increased order quantities
14.If a company obtains two salable products from the refining of one ore, the
refining process should be accounted for as a(n). Single choice.
(1 Point)
a. mixed cost process.
b. joint process.
c. extractive process.
d. reduction process.
15.Joint cost allocation is useful for. Single choice.
(1 Point)
a. decision making.
b. product costing.
c. control.
d. evaluating managers’ performance.
16.Which of the following components of production are allocable as joint costs
when a single manufacturing process produces several salable products?. Single
choice.
(1 Point)
a. direct material, direct labor, and overhead
b. direct material and direct labor only
c. direct labor and overhead only
d. overhead and direct material only
17.Joint costs are most frequently allocated based upon relative. Single choice.
(1 Point)
a. profitability.
b. conversion costs.
c. prime costs.
d. sales value
18. If two or more products share a common process before they are separated,
the joint costs should be assigned in a manner that. Single choice.
(1 Point)
a. assigns a proportionate amount of the total cost to each product on a quantitative basis.
 b. maximizes total earnings.
c. minimizes variations in unit production costs.
d. does not introduce an element of estimation into the process of accumulating costs for each
product.
19.Company Q produces three products from a joint process. The products can
be sold at split-off or processed further. In deciding whether to sell at split-off or
process further, management should. Single choice.
(1 Point)
a. allocate the joint cost to the products based on relative sales value prior to making the
decision.
b. allocate the joint cost to the products based on a physical quantity measure prior to making
the decision.
c. subtract the joint cost from the total sales value of the products before determining relative
sales value and making the decision.
d. ignore the joint cost in making the decision.
20.By-products are. Single choice.
(1 Point)
a. allocated a portion of joint production cost.
b. not sufficient alone, in terms of sales value, for management to justify undertaking the joint
process.
c. also known as scrap.
d. the primary reason management undertook the production process.
21. Which of the following is a false statement about scrap and by-products?.
Single choice.
(1 Point)
a. Both by-products and scrap are salable.
b. A by-product has a higher sales value than does scrap.
c. By-products and scrap are the primary reason that management undertakes the joint process.
d. Both scrap and by-products are incidental outputs to the joint process.
22.For purposes of allocating joint costs to joint products using the relative sales
value at split-off method, the costs beyond split-off. Single choice.
(1 Point)
a. are allocated in the same manner as the joint costs.
b. are deducted from the relative sales value at split-off.
 c. are deducted from the sales value at the point of sale.
d. do not affect the allocation of the joint costs.
23.A process costing system is used by a company that. Single choice.
(1 Point)
a. produces heterogeneous products.
b. produces items by special request of customers.
c. produces homogeneous products.
d. accumulates costs by job.
24.Equivalent units of production are equal to the. Single choice.
(1 Point)
a. units completed by a production department in the period.
b. number of units worked on during the period by a production department.
c. number of whole units that could have been completed if all work of the period had been
used to produce whole units.
d. identifiable units existing at the end of the period in a production department.
25.In a process costing system using the weighted average method, cost per
equivalent unit for a given cost component is found by dividing which of the
following by EUP?. Single choice.
(1 Point)
a. only current period cost
b. current period cost plus the cost of beginning inventory
c. current period cost less the cost of beginning inventory
d. current period cost plus the cost of ending inventory
26.The first step in determining the cost per EUP per cost component under the
weighted average method is to. Single choice.
(1 Point)
a. add the beginning Work in Process Inventory cost to the current period’s production cost.
b. divide the current period’s production cost by the equivalent units.
c. subtract the beginning Work in Process Inventory cost from the current period’s production
cost.
d. divide the current period’s production cost into the EUP.
27.In a FIFO process costing system, which of the following are assumed to be
completed first in the current period?. Single choice.
(1 Point)
 a. units started this period
b. units started last period
c. units transferred out
d. units still in process
28.The FIFO method of process costing will produce the same cost of goods
transferred out amount as the weighted average method when. Single choice.
(1 Point)
a. the goods produced are homogeneous.
b. there is no beginning Work in Process Inventory.
c. there is no ending Work in Process Inventory.
d. beginning and ending Work in Process Inventories are each 50 percent complete.
29.Material is added at the beginning of a process in a process costing system.
The beginning Work in Process Inventory for the process was 30 percent
complete as to conversion costs. Using the FIFO method of costing, the number
of equivalent units of material for the process during this period is equal to the.
Single choice.
(1 Point)
a. beginning inventory this period for the process.
b. units started this period in the process.
c. units started this period in the process plus the beginning Work in Process Inventory.
d. units started and completed this period plus the units in ending Work in Process Inventory.
30.Process costing techniques should be used in assigning costs to products.
Single choice.
(1 Point)
a. if a product is manufactured on the basis of each order received.
b. when production is only partially completed during the accounting period.
c. if a product is composed of mass-produced homogeneous units.
d. whenever standard-costing techniques should not be used
31.Averaging the total cost of completed beginning inventory and units started
and completed over all units transferred out is known as. Single choice.
(1 Point)
a. strict FIFO.
b. modified FIFO.
 c. weighted average costing.
d. normal costing.
32.A hybrid costing system combines characteristics of. Single choice.
(1 Point)
a. job order and standard costing systems.
b. job order and process costing systems.
c. process and standard costing systems.
d. job order and normal costing systems.
33.When standard costs are used in process costing,. Single choice.
(1 Point)
a. variances can be measured during the production period.
b. total costs rather than current production and current costs are used.
c. process costing calculations are made simpler.
d. the weighted average method of calculating EUPs makes computing transferred-out costs
easier.
34.A process costing system. Single choice.
(1 Point)
a. cannot use standard costs.
b. restates Work in Process Inventory in terms of completed units.
c. accumulates costs by job rather than by department.
d. assigns direct labor and manufacturing overhead costs separately to units of production
35.Transferred-in cost represents the cost from. Single choice.
(1 Point)
a. the last department only.
b. the last production cycle.
c. all prior departments.
d. the current period only
36.In a process costing system, the journal entry to record the transfer of goods
from Department #2 to Finished Goods Inventory is a. Single choice.
(1 Point)
a. debit Work in Process Inventory #2, credit Finished Goods Inventory.
b. debit Finished Goods Inventory, credit Work in Process Inventory #1.
c. debit Finished Goods Inventory, credit Work in Process Inventory #2.
 d. debit Cost of Goods Sold, credit Work in Process Inventory #2.
37.The primary difference between the FIFO and weighted average methods of
process costing is. Single choice.
(1 Point)
a. in the treatment of beginning Work in Process Inventory.
b. in the treatment of current period production costs.
c. in the treatment of spoiled units.
d. none of the above
38.To compute equivalent units of production using the FIFO method of process
costing, work for the current period must be stated in units. Single choice.
(1 Point)
a. completed during the period and units in ending inventory.
b. completed from beginning inventory, units started and completed during the period, and
units partially completed in ending inventory.
c. started during the period and units transferred out during the period.
d. processed during the period and units completed during the period.
39.The difference between EUP calculated using FIFO and EUP calculated using
weighted average is the equivalent units. Single choice.
(1 Point)
a. started and completed during the period.
b. residing in beginning Work in Process Inventory.
c. residing in ending Work in Process Inventory.
d. uncompleted in Work in Process Inventory.
40.A producer of ________ would not use a process costing system.. Single choice.
(1 Point)
a. gasoline
b. potato chips
c. blank videotapes
d. stained glass windows
41.Kim Co. makes small metal containers. The company began December with
250 containers in process that were 30 percent complete as to material and 40
percent complete as to conversion costs. During the month, 5,000 containers
were started. At month end, 1,700 containers were still in process (45 percent
complete as to material and 80 percent complete as to conversion costs). Using
the weighted average method, what are the equivalent units for conversion
costs?. Single choice.
(2 Points)
a. 4,610
b. 4,910
c. 3,450
d. 4,560
42.Lisa Co. makes fabric-covered hatboxes. The company began August with 500
boxes in process that were 100 percent complete as to cardboard, 80 percent
complete as to cloth, and 60 percent complete as to conversion costs. During the
month, 3,300 boxes were started. On August 31, 350 boxes were in process (100
percent complete as to cardboard, 70 percent complete as to cloth, and 55
percent complete as to conversion costs). Using the FIFO method, what are
equivalent units for cloth?. Single choice.
(2 Points)
a. 3,450
b. 3,295
c. 3,395
d. 3,595
43.Murphy Co. uses a weighted average process costing system and started
30,000 units this month. Murphy had 12,000 units that were 20 percent complete
as to conversion costs in beginning Work in Process Inventory and 3,000 units
that were 40 percent complete as to conversion costs in ending Work in Process
Inventory. What are equivalent units for conversion costs?. Single choice.
(2 Points)
a. 37,800
b. 42,000
c. 40,200
d. 40,800
44.Brown Co. started 9,000 units in October. The company transferred out 7,000
finished units and ended the period with 3,500 units that were 40 percent
complete as to both material and conversion costs. Beginning Work in Process
Inventory units were. Single choice.
(2 Points)
 a. 500.
b. 600.
c. 1,500.
d. 2,000.
45.Sun Co. produces three products from the same process that has joint
processing costs of $4,100. Products RR, SS, and TT are produced in the following
gallons per month, respectively: 250, 400, and 750. Sun also incurred advertising
costs of $60,000; the ad was used to run sales for all three products. They occupy
floor space in the following ratio: 5:4:9. (Round all answers to the nearest
dollar.)Using gallons as the physical measurement, what amount of joint
processing cost is allocated to SS?. Single choice.
(2 Points)
a. $2,196
b. $1,171
c. $1,367
d. $732
46.Love Co. manufactures products A and B from a joint process. Sales value at
split-off was $700,000 for 10,000 units of A, and $300,000 for 15,000 units of B.
Using the sales value at split-off approach, joint costs properly allocated to A
were $140,000. Total joint costs were. Single choice.
(2 Points)
a. $98,000.
b. $200,000.
c. $233,333.
d. $350,000
47.Which of the following is not a benefit of activity-based costing?. Single
choice.
(1 Point)
A. More accurate product costing.
B. Enhanced control over overhead costs.
C. Less costly to use.
D. Better management decisions
48.Which of the following is typical of activity-based costing systems?. Single
choice.
(1 Point)
A. Use of a single predetermined overhead rate.
B. Use of direct labor hours or direct labor cost to assign overhead.
C. Assumption of correlation between direct labor and incurrence of overhead cost.
D. Use of multiple cost drivers to allocate overhead.
49.An activity-based costing system uses which of the following procedures?.
Single choice.
(1 Point)
A. Overhead costs are traced to departments, then costs are traced to products.
B. Overhead costs are traced to activities, then costs are traced to products.
C. Overhead costs are traced directly to products.
D. All overhead costs are expensed as incurred.
50.A well-designed activity-based costing system starts with. Single choice.
(1 Point)
A. identifying the activity-cost pools.
B. computing the activity-based overhead rate.
C. assigning manufacturing overhead costs for each activity cost pool to products.
D. analyzing the activities performed to manufacture a product
51.Successful activity-based costing (ABC) implementation depends upon the
firm having:. Single choice.
(1 Point)
A. top management support
B. ABC linked to its competitive strategy
C. adequate resources
D. all of the above
52.An appropriate cost driver base should. Single choice.
(1 Point)
A. have a cause-and-effect relationship with the activity and the use of resources
B. predict or explain activities' use of resources with reasonable accuracy
C. be based on the practical capacity of the resource to support activities
D. all of the above
53. Activity-based overhead rates are more useful than a single plant-wide rate if.
Single choice.
(1 Point)
A. overhead costs are driven by several activities.
B. direct labor cost varies significantly from department to department.
C. all products require about the same amounts of all activities.
D. manufacturing overhead costs are nearly all fixed.
54.Examples of unit-level costs are. Single choice.
(1 Point)
A. portions of electricity and indirect materials
B. salaries of schedulers and setup personnel
C. salaries of designers and programmers
D. depreciation and insurance of building
55.Examples of unit level activities are. Single choice.
(1 Point)
A. scheduling, setting up, and receiving
B. designing, changing, and advertising
C. heating, lighting, and security
D. cutting, painting, and packaging
56.Examples of activities at the product level of costs include. Single choice.
(1 Point)
A. cutting, painting, and packaging
B. scheduling, setting up, and moving
C. designing, changing, and advertising
D. heating, lighting and security
57.Which of the following is the best way to consider a product-level cost?..
Single choice.
(1 Point)
A. A product-level cost can be avoided when a product line is discontinued.
B. A product-level cost can be avoided when a there is change in the production schedule so the
product is not produced this week.
C. A product level cost can be avoided when a business segment is discontinued.
D. A product level cost can be avoided when the corporation is dissolved.
58.When a firm redesigns a product to reduce the number of component parts,
the firm is. Single choice.
(1 Point)
A. increasing consumer value.
B. increasing the value added to the product.
C. decreasing product variety.
D. decreasing non-value-added costs.
59.Plant-level costs are costs that. Single choice.
(1 Point)
A. inevitably increase whenever a unit is produced
B. are caused by the number of batches produced and sold
C. are incurred to support the number of different products produced
D. are incurred to sustain capacity at a production site
60. Which of the following is not considered to be a facility-level cost?. Single
choice.
(1 Point)
A. Cost of Property Insurance.
B. Cost of personnel administration.
C. Cost of Liability Insurance for only one of the product lines.
D. Cost of building security
61.Manufacturing cycle efficiency is a measure of. Single choice.
(1 Point)
A. bottlenecks.
B. effectiveness.
C. efficiency.
D. quality.
62.Arid Company produces products BH and XP. The direct cost of BH is P250 per
unit and XP is P350 per unit. Fifty units of BH and 150 units of XP were produced.
Overhead amounting to P130,000 is allocated to products using direct costs as
the relevant cost driver. The cost of XP per unit amounts to. Single choice.
(2 Points)
A. P750
B. P1,000
C. P1,050
D. P1,250
63.One of Alien Company’s activity cost pools is machine setups, with estimated
overhead of P300,000. Alien produces slacks (400 setups) and shirts (600 setups).
How much of the machine setup cost pool should be assigned to slacks?. Single
choice.
(2 Points)
A. P 0
B. P120,000
C. P150,000
D. P180,000
64.Sylvia Company has identified an activity cost pool to which it has allocated
estimated overhead of P1,920,000 and determined the expected use of cost
drivers per that activity to by 160,000 inspections. Widgets require 40,000
inspections, Gadgets 30,000 inspections, and Targets, 90,000 inspections. The
overhead assigned to each product is. Single choice.
(2 Points)
A. Widgets P40,000, Gadgets P30,000, Targets P90,000
B. Widgets P480,000, Gadgets P360,000, Targets P1,080,000
C. Widgets P360,000, Gadgets P480,000, Targets P1,080,000
D. Widgets P480,000, Gadgets P360,000, Targets P1,080,000
65.EMPIRE Company makes two products, E and M. E is being introduced this
period, whereas M has been in production for 2 years. For the period about to
begin, 1,000 units of each product are to be manufactured. The only relevant
overhead item is the cost of engineering change orders. E and M are expected to
require eight and two change orders, respectively. E and M are expected to
require 2 and 3 machine hours, respectively. The cost of a change order is P600. If
EMPIRE applies engineering change order cost on the basis of machine hours, the
overhead cost per unit to be assigned to E and M, respectively, are. Single choice.
(2 Points)
A. P2.40 and P3.60, respectively
B. P3.60 and P2.40, respectively
C. P4.80 and P3.60, respectively
D. P3.60 and P4.80, respectively
66.The Assembly Department started the month with 83,000 units in its
beginning work in process inventory. An additional 334,000 units were
transferred in from the prior department during the month to begin processing in
the Assembly Department. There were 34,000 units in the ending work in process
inventory of the Assembly Department. How many units were transferred to the
next processing department during the month?. Single choice.
(2 Points)
A) 417,000
B) 285,000
C) 451,000
D) 383,000
67.Destry Company uses the weighted-average method in its process costing
system. The first processing department, the Welding Department, started the
month with 10,000 units in its beginning work in process inventory that were 30%
complete with respect to conversion costs. The conversion cost in this beginning
work in process inventory was $19,200. An additional 60,000 units were started
into production during the month. There were 19,000 units in the ending work in
process inventory of the Welding Department that were 70% complete with
respect to conversion costs. A total of $380,060 in conversion costs were incurred
in the department during the month. What would be the cost per equivalent unit
for conversion costs for the month? (Round off to three decimal places.). Single
choice.
(2 Points)
A) $6.400
B) $6.334
C) $6.209
D) $4.811
68.Jimmy Company uses the weighted-average method in its process costing
system. The ending work in process inventory consists of 9,000 units. The ending
work in process inventory is 100% complete with respect to materials and 70%
complete with respect to labor and overhead. If the cost per equivalent unit for
the period is $3.75 for material and $1.25 for labor and overhead, what is the
balance of the ending work in process inventory account?. Single choice.
(2 Points)
A) $41,625
B) $33,750
C) $45,000
D) $31,500
69.Jersey Company has a process costing system in which it uses the weighted-
average method. The equivalent units for conversion costs for the month were
47,500 units. The beginning work in process inventory consisted of 15,000 units,
60% complete with respect to conversion costs. The ending work in process
inventory consisted of 10,000 units, 75% complete with respect to conversion
costs. The number of units started during the month was:. Single choice.
(2 Points)
A) 25,000 units
B) 34,000 units
C) 35,000 units
D) 40,000 uni
70.Boswal Company uses the weighted-average method in its process costing
system. The Assembly Department started the month with 6,000 units in its
beginning work in process inventory that were 80% complete with respect to
conversion costs. An additional 52,000 units were transferred in from the prior
department during the month to begin processing in the Assembly Department.
There were 18,000 units in the ending work in process inventory of the Assembly
Department that were 20% complete with respect to conversion costs. What were
the equivalent units for conversion costs in the Assembly Department for the
month?. Single choice.
(2 Points)
A) 43,600
B) 40,000
C) 38,800
D) 64,000
71.Parks Company uses the weighted-average method in its process costing
system. At the start of the year, the company had 5,000 units in process in
Department A that were 60% complete with respect to conversion costs. At the
end of the year, 6,500 units were in process, 40% complete with respect to
conversion costs. During the year, 30,000 units were completed and transferred
on to the next department. The equivalent units for conversion costs would be:.
Single choice.
(2 Points)
A) 32,600 units
B) 29,600 units
 C) 33,000 units
D) 30,000 units
72.Fatas Corporation uses the weighted-average method in its process costing
system. The Assembly Department started the month with 8,000 units in its
beginning work in process inventory that were 20% complete with respect to
conversion costs. An additional 95,000 units were transferred in from the prior
department during the month to begin processing in the Assembly Department.
During the month 102,000 units were completed in the Assembly Department
and transferred to the next processing department. There were 1,000 units in the
ending work in process inventory of the Assembly Department that were 20%
complete with respect to conversion costs. What were the equivalent units for
conversion costs in the Assembly Department for the month?. Single choice.
(2 Points)
A) 102,200
B) 100,600
C) 102,000
D) 88,000
73.Kew Company uses the weighted-average method in its process costing
system. The company had 3,000 units in work in process at April 1 that were 60%
complete with respect to conversion cost. During April, 10,000 units were
completed. At April 30, 4,000 units remained in work in process and they were
40% complete with respect to conversion cost. Direct materials are added at the
beginning of the process. How many units were started during April?. Single
choice.
(2 Points)
A) 9,000
B) 9,800
C) 10,000
D) 11,000
74.Lap Company uses the weighted-average method in its process costing
system. The beginning work in process inventory in a particular department
consisted of 80,000 units, 100% complete with respect to materials and 25%
complete with respect to conversion costs. The total dollar value of this inventory
was $226,000. During the month, 150,000 units were transferred out of the
department. The costs per equivalent unit for the month were $2.00 for materials
and $3.50 for conversion costs. The value of the units completed and transferred
out of the department was:. Single choice.
(2 Points)
A) $681,000
B) $765,000
C) $821,000
D) $825,000
75.Edwin Company uses the FIFO method in its process costing system. The first
processing department, the Welding Department, started the month with 22,000
units in its beginning work in process inventory that were 20% complete with
respect to conversion costs. The conversion cost in this beginning work in
process inventory was $24,200. An additional 96,000 units were started into
production during the month. There were 20,000 units in the ending work in
process inventory of the Welding Department that were 90% complete with
respect to conversion costs. A total of $585,900 in conversion costs were incurred
in the department during the month. What would be the cost per equivalent unit
for conversion costs? (Round off to three decimal places.). Single choice.
(2 Points)
A) $6.103
B) $5.170
C) $5.500
D) $5.250
76.Which of the following statements related to job-order costing and process
costing are true. Single choice.
(1 Point)
A) Under both costing methods, manufacturing overhead costs are included in the computation
of unit product costs.
B) Under both costing methods, the journal entry to record the completion of production will
involve crediting a work in process account.
C) Under both costing methods, the journal entry to record the cost of goods sold will involve
crediting the finished goods account.
D) All of the above are true.
77. In process costing, a separate work in process account is kept for each. Single
choice.
(1 Point)
 A) individual order.
B) equivalent unit.
C) processing department.
D) cost category (i.e., materials, conversion cost).
78.The weighted-average method of process costing differs from the FIFO
method of process costing in that the weighted-average method:. Single choice.
(1 Point)
A) does not consider the degree of completion of beginning work in process inventory when
computing equivalent units of production.
B) considers ending work in process inventory to be fully complete.
C) will always yield a higher cost per equivalent unit.
D) All of the above
79.All of the following statements are correct when referring to process costing
except:. Single choice.
(1 Point)
A) Process costing would be appropriate for a jeweler who makes custom jewelry to order.
B) A process costing system has the same basic purposes as a job-order costing system.
C) Units produced are indistinguishable from each other.
D) Costs are accumulated by department.
80.For which of the following would it be best to use an operation costing
system?. Single choice.

(1 Point)
A) home remodeling
B) automobile production
C) cement used for roadways
D) trash bags used for yard waste