Question 1

All the linked activities undertaken within an entity from the inception of the product or service to the final delivery to customers is known as the ____________________ value chain

Accepted Answer

The answer of All the linked activities undertaken within an...

Question 2

Which of these is $\bold{not}$ a pricing method?

Accepted Answer

Peak load pricing, price skimming, and price discrimination are all commonly recognized pricing methods. "Greedy pricing" is not a common pricing method and is not recognized in any academic or professional literature on pricing strategies.

Question 3

When different prices are charged at different times to reduce capacity restraints (e.g.toll charges on the Sydney Harbour bridge are higher during peak hour),this is known as:

Accepted Answer

Peak-load pricing is the pricing practice of charging different prices for products or services based on different demand levels during different times to deal with capacity constraints or high demand periods. For example, in transportation, toll charges are higher during peak hours to encourage the use of public transportation or reduce congestion. This practice is known as peak-load pricing. Price skimming is a practice where a firm charges a very high price for its new product or service initially but reduces it as time passes. Penetration pricing is a marketing strategy where a company sets a low initial price for a product intending to increase market share. Price discrimination is the practice of charging different prices for similar products or services to different customers, and it is usually considered a negative practice where certain groups or individuals may face unfair treatment.

Question 4

The practice used by foreign based entities of selling products in Australia at prices below the market value in the country where the product is produced at prices that could harm an Australian industry is known as:

Accepted Answer

Dumping is the practice of selling products in a foreign country at a lower price than the price charged in their domestic market. This can harm Australian industries as they may struggle to compete with the artificially low-priced imports. This is why governments often impose anti-dumping measures to protect their domestic industries. Predatory pricing is the practice of selling products at a low price to drive competitors out of the market, while penetration pricing is the practice of initially setting a low price for a new product to attract customers. Collusive pricing is when companies collude to set prices together.

Question 5

Setting low prices when new products are introduced to increase market share is known as:

Accepted Answer

Penetration pricing is the strategy of setting low prices when new products are introduced to increase market share. This strategy is used to attract customers and gain a foothold in the market. As the market share increases, prices can be gradually increased.

Question 6

Labour hours,machine hours and units of output are examples of ______________ drivers that use a measure of output to assign indirect costs to cost objects.

Accepted Answer

The answer of Labour hours,machine hours and units of output...

Question 7

The accuracy of cost information increases as the number of cost pools (increases/decreases)_________________.

Accepted Answer

The answer of The accuracy of cost information increases as...

Question 8

Inventoriable product cost is the sum of direct and indirect _______________ costs.

Accepted Answer

The answer of Inventoriable product cost is the sum of...

Question 9

An indirect cost is linked to individual cost objects by identification of an appropriate cost ___________.

Accepted Answer

The answer of An indirect cost is linked to individual...

Question 10

The following information is available for product XX5.
Direct material costs $48.00 per unit of product
Costs of machining $37.50 per machine hour
Costs of packing $12.50 per carton packed
What is the total full cost of an order for 1000 units of product XX5 which will use 65 machine hours and 45 cartons?

Accepted Answer

The total full cost includes direct material costs, machining costs, and packing costs. For 1000 units, the direct material cost is 1000 * $48 = $48,000. The machining cost for 65 hours is 65 * $37.50 = $2,437.50. The packing cost for 45 cartons is 45 * $12.50 = $562.50. Adding these gives $48,000 + $2,437.50 + $562.50 = $51,000.

Question 11

The statement concerned with pricing that is $\bold{not}$ true is:

Accepted Answer

Cost-based pricing is based on the company's costs and profit margin, and may not reflect the maximum price customers are willing to pay. In contrast, market-based pricing takes into account customer demand and competitors' prices, resulting in prices that are closer to what customers would be willing to pay. Therefore, cost-based prices may be higher or lower than what customers are willing to pay, depending on the specific circumstances.

Question 12

Indirect costs are incurred for the benefit of (one/multiple)_________________ cost object(s).

Accepted Answer

The answer of Indirect costs are incurred for the benefit...

Question 13

The product costing system used by manufacturing entities that produce large numbers of identical items in a continuous production process is known as a _______________ costing system.

Accepted Answer

The answer of The product costing system used by manufacturing...

Question 14

One criteria that can be used in the selection of cost drivers is _______________ received.

Accepted Answer

The answer of One criteria that can be used in...

Question 15

To calculate the total cost of a cost object,________ costs need to be traced and indirect costs allocated.

Accepted Answer

The answer of To calculate the total cost of a...

Question 16

Costs that can be directly traced to a cost object in an economical manner are known as _____________ costs.

Accepted Answer

The answer of Costs that can be directly traced to...

Question 17

Cost-based pricing is a pricing method that:

Accepted Answer

Cost-based pricing calculates the cost of producing a product or service, including all expenses such as materials, labor, overhead costs, and adds a markup to ensure a profit. The markup can be a percentage or a fixed amount that covers the company's fixed or variable costs and generates a profit margin. It is a widely used pricing strategy in manufacturing, retail, and service industries.

Question 18

A ____________ system is the system used by entities to collect and report the cost of resources used by particular cost objects.

Accepted Answer

The answer of A ____________ system is the system used...

Question 19

In the activity hierarchy,costs incurred for the benefit of the entire entity are known as ________________ level costs.

Accepted Answer

The answer of In the activity hierarchy,costs incurred for the...

Question 20

In determining the cost of inventory,Department A's indirect costs are to be allocated using machine hours as the cost driver.If Department A's indirect costs total $300 000 and it expects to use 25 500 machine hours for the period the indirect cost rate for the department is:

Accepted Answer

The indirect cost rate is calculated by dividing the total indirect costs by the total machine hours. $300,000 / 25,500 machine hours = $11.765 per machine hour.

Quiz 11: Costing and Pricing in an Entity

All the linked activities undertaken within an entity from the inception of the product or service to the final delivery to customers is known as the ____________________ value chain

Which of these is $\bold{not}$ a pricing method?

When different prices are charged at different times to reduce capacity restraints (e.g.toll charges on the Sydney Harbour bridge are higher during peak hour) ,this is known as:

The practice used by foreign based entities of selling products in Australia at prices below the market value in the country where the product is produced at prices that could harm an Australian industry is known as:

Setting low prices when new products are introduced to increase market share is known as:

Labour hours,machine hours and units of output are examples of ______________ drivers that use a measure of output to assign indirect costs to cost objects.

The accuracy of cost information increases as the number of cost pools (increases/decreases)_________________.

Inventoriable product cost is the sum of direct and indirect _______________ costs.

An indirect cost is linked to individual cost objects by identification of an appropriate cost ___________.

The statement concerned with pricing that is $\bold{not}$ true is:

Indirect costs are incurred for the benefit of (one/multiple)_________________ cost object(s).

The product costing system used by manufacturing entities that produce large numbers of identical items in a continuous production process is known as a _______________ costing system.

One criteria that can be used in the selection of cost drivers is _______________ received.

To calculate the total cost of a cost object,________ costs need to be traced and indirect costs allocated.

Costs that can be directly traced to a cost object in an economical manner are known as _____________ costs.

Cost-based pricing is a pricing method that:

A ____________ system is the system used by entities to collect and report the cost of resources used by particular cost objects.

In the activity hierarchy,costs incurred for the benefit of the entire entity are known as ________________ level costs.

In determining the cost of inventory,Department A's indirect costs are to be allocated using machine hours as the cost driver.If Department A's indirect costs total $300 000 and it expects to use 25 500 machine hours for the period the indirect cost rate for the department is:

Quiz 11: Costing and Pricing in an Entity

All the linked activities undertaken within an entity from the inception of the product or service to the final delivery to customers is known as the ____________________ value chain

Which of these is not\bold{not}not a pricing method?

When different prices are charged at different times to reduce capacity restraints (e.g.toll charges on the Sydney Harbour bridge are higher during peak hour) ,this is known as:

The practice used by foreign based entities of selling products in Australia at prices below the market value in the country where the product is produced at prices that could harm an Australian industry is known as:

Setting low prices when new products are introduced to increase market share is known as:

Labour hours,machine hours and units of output are examples of ______________ drivers that use a measure of output to assign indirect costs to cost objects.

The accuracy of cost information increases as the number of cost pools (increases/decreases)_________________.

Inventoriable product cost is the sum of direct and indirect _______________ costs.

An indirect cost is linked to individual cost objects by identification of an appropriate cost ___________.

The statement concerned with pricing that is not\bold{not}not true is:

Indirect costs are incurred for the benefit of (one/multiple)_________________ cost object(s).

The product costing system used by manufacturing entities that produce large numbers of identical items in a continuous production process is known as a _______________ costing system.

One criteria that can be used in the selection of cost drivers is _______________ received.

To calculate the total cost of a cost object,________ costs need to be traced and indirect costs allocated.

Costs that can be directly traced to a cost object in an economical manner are known as _____________ costs.

Cost-based pricing is a pricing method that:

A ____________ system is the system used by entities to collect and report the cost of resources used by particular cost objects.

In the activity hierarchy,costs incurred for the benefit of the entire entity are known as ________________ level costs.

In determining the cost of inventory,Department A's indirect costs are to be allocated using machine hours as the cost driver.If Department A's indirect costs total $300 000 and it expects to use 25 500 machine hours for the period the indirect cost rate for the department is:

Which of these is $\bold{not}$ a pricing method?

The statement concerned with pricing that is $\bold{not}$ true is: