Management Accounting - Study Mode
[#336] In customer cost hierarchy, costs of all incurred activities to sell a unit of product are classified as
Correct Answer
(B) customer output unit-level costs
Explanation
Solution: In customer cost hierarchy, costs of all incurred activities to sell a unit of product are classified as customer output unit-level costs. Output unit-level costs are the costs of activities performed on each individual unit of a product or service.
[#337] Which of following do not include among major categories of corporate costs?
Correct Answer
(D) discretionary costs
Explanation
Solution: Corporate administration costs do not include among major categories of corporate costs. These costs include the accounting, human resources, legal, marketing, and sales functions. When corporate costs are incurred, they are considered to be period costs, and so are charged to expense as incurred.
[#338] In customer cost hierarchy, costs of those activities that cannot be traced to distribution channels or individual customers are called
Correct Answer
(B) corporate-sustaining costs
Explanation
Solution: In customer cost hierarchy, costs of those activities that cannot be traced to distribution channels or individual customers are called corporate-sustaining costs.
[#339] If an actual result in static budget is $2500 and corresponding budgeted amount is $2200, then static budget variance will be
Correct Answer
(B) $300
Explanation
Solution: Static budget variance = Static budget - Corresponding budgeted amount = $2500 - $2200 = $300.
[#340] In customer cost hierarchy, costs of individual customer support activities are classified as
Correct Answer
(D) customer-sustaining costs
Explanation
Solution: In customer cost hierarchy, costs of individual customer support activities are classified as customer-sustaining costs. A customer-sustaining cost is the cost of resources consumed to service a customer regardless of the number of units sold to the customer.