Accounting Information Systems
11th Edition
ISBN: 9781337552127
Author: Ulric J. Gelinas, Richard B. Dull, Patrick Wheeler, Mary Callahan Hill
Publisher: Cengage Learning
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Textbook Question
Chapter 15, Problem 2P
Study Figure 15.8, showing the level 0 DFD of the cost accounting system. Note that the raw materials and finished goods inventory processes are outside the context of the system shown (i.e., the DFD covers work-in-process inventory only).
- a. Draw a context diagram for the system as it currently exists.
- b. Assume that both the raw materials and finished goods inventories are within the system context. Prepare a context diagram for the revised system, and redraw Figure 15.8 to reflect the revised system. Ignore the ordering of raw materials from vendors; start the raw materials process with the receipt of goods. Also ignore the issue of finished goods. Keep the assumption that the company uses
standard costing for all inventories.
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Systems Concepts, Traditional versus Activity-Based Cost Accounting Systems
The following items are associated with a traditional cost accounting information system, an activity-based cost accounting information system, or both (that is, some elements are common to the two systems):
Required:
1. Select the appropriate categories for each of the following items:
a.
Usage of direct materials
b.
Direct materials cost assigned to products using direct tracing
c.
Direct labor cost incurrence
d.
Direct labor cost assigned to products using direct tracing
e.
Setup cost incurrence
f.
Setup cost assigned using number of setups as the activity driver
g.
Setup cost assigned using direct labor hours as the activity driver
h.
Cost accounting personnel
i.
Submission of a bid, using product cost plus 25 percent
j.
Purchasing cost incurrence
k.
Purchasing cost assigned to products using direct labor hours as the activity driver
l.
Purchasing cost assigned…
Q.3.4 Briefly discuss the following concepts. Your discussion should include reference as
to how it is determined:
Actual manufacturing overhead costs.
Budgeted manufacturing overhead costs.
Allocated or applied manufacturing overhead costs.
●
Which of the following is not a product-level activity?
A. Product design
1
B. Engineering changes
C. Inventory management
D. Equipment setups
Chapter 15 Solutions
Accounting Information Systems
Ch. 15 - Prob. 1RQCh. 15 - Explain the three key drivers of complexity in...Ch. 15 - Describe the three key characteristics of...Ch. 15 - Prob. 4RQCh. 15 - Prob. 5RQCh. 15 - Prob. 6RQCh. 15 - Prob. 7RQCh. 15 - Prob. 8RQCh. 15 - Prob. 9RQCh. 15 - Prob. 10RQ
Ch. 15 - Prob. 11RQCh. 15 - Prob. 12RQCh. 15 - a. How are a bill of materials (BOM) and a routing...Ch. 15 - Prob. 14RQCh. 15 - Prob. 15RQCh. 15 - Prob. 16RQCh. 15 - Prob. 17RQCh. 15 - Prob. 18RQCh. 15 - Why is inventory management and control important...Ch. 15 - Prob. 21RQCh. 15 - Prob. 1DQCh. 15 - Prob. 3DQCh. 15 - What industry do you believe is a leader in...Ch. 15 - Prob. 5DQCh. 15 - Prob. 6DQCh. 15 - Prob. 7DQCh. 15 - Prob. 8DQCh. 15 - In addition to the industries mentioned in...Ch. 15 - A main goal of JIT is zero inventories. a. Assume...Ch. 15 - Prob. 11DQCh. 15 - Discuss how the inventory process supports the...Ch. 15 - Prob. 13DQCh. 15 - Prob. 14DQCh. 15 - Prob. 1SPCh. 15 - Prob. 2SPCh. 15 - Prob. 3SPCh. 15 - Prob. 4SPCh. 15 - Prob. 5SPCh. 15 - Study Figure 15.8, showing the level 0 DFD of the...Ch. 15 - Prob. 3PCh. 15 - Prob. 4PCh. 15 - Prob. 5PCh. 15 - Prob. 6PCh. 15 - Prob. 7P
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- For each cost pool, identify an appropriate cost driver. A. order department B. accounts receivable processing C. catering D. raw material inventoryarrow_forwardDefine and explain the two major subsystems of the cost management information system.arrow_forwardExplain why the Accounting Department should be responsible for producing quality cost reports.arrow_forward
- Which is not a task typically associated with ABC systems? A. calculating the overhead application rate for each cost pool B. applying a single cost rate C. identifying a cost driver D. more correctly allocating overhead costsarrow_forwardIdentify appropriate cost drivers for these cost pools: A. setup cost pools B. assembly cost pool C. supervising cost pool D. testing cost poolarrow_forwardAccumulating costs means that a. costs must be summed and entered on the income statement. b. each cost must be linked to some cost object. c. costs must be measured and tracked. d. costs must be allocated to units of production. e. costs have expired and must be transferred from the balance sheet to the income statement.arrow_forward
- What are the objectives of a cost management information system?arrow_forwardHow are cost of production reports used for controlling and improving operations?arrow_forwardWhich of the following statements is true? Direct costs are allocated to cost objects using a predetermined overhead rate. Period costs are allocated to inventory in order to determine the amount to be reported on the balance sheet. Indirect costs are allocated to cost objects using a predetermined overhead rate. Indirect costs are traced to costs objects based on the cost object identified on the purchase and requisition orders.arrow_forward
- Label each of the following activities as unit-level batch-level, product-level, or facility-level activity. Determine one or more potential cost driver(s) for each activities. warehouse expense machine setup quality control engineering design production schedulingarrow_forwardThe appropriate cost accounting system to use when inventory items are produced on an assembly line is a. perpetual method. b. job-order costing. c. weighted average. d. process costing.arrow_forwardFactors affecting the classification of a cost as direct or indirect include: A. cost behaviour patterns, cost drivers, and relevant ranges. B. materiality of the cost, available information-gathering technology, and design of operations. C. materials, labour, and factory overhead D. unit costs, inventory production stage, and contractual agreements.arrow_forward
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