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Activity Based Costing

Professor Leticia Togba, CPA
ACCT 2302 - Principles of Managerial Acctng
Ch. 17 (3E) and Ch. 18 (2E)
Across
Activity ______ ________: The overhead cost attributed to a distinct type of activity or related activities.
Step #3 of ABC: __________ the activity-based overhead rate for each cost pool.
Activity-_________ Costing (ABC): A costing system that allocates overhead to multiple activity cost pools and assigns the activity cost pools to products and services by means of cost drivers.
_______-Level Activities: Activities performed for each unit of production.
______-________ Activities: Activities performed for each batch of products rather than each unit.
2nd Element of JIT Processing: A ____________ work force.
Step #1 of ABC: Identify and _________ the activities involved in the manufacture of specific products and allocate overhead to cost pools.
________-Level Activities: Activities required to support or sustain an entire production process.
Any event, action, transaction, or work sequence hat incurs costs when producing a product or performing a service.
______-_______ Added Activity: An activity that, if eliminated, would not reduce the perceived value of a company's product or service.
Down
An advantage of ABC is that it leads to ___________ control over overhead costs.
The ________ of JIT Processing is to eliminate manufacturing inventories by using a "pull approach" in manufacturing.
1st Element of JIT Processing: _________ suppliers.
_________-Level Activities: Activities performed in support of an entire product line, but not always performed for every time a new unit or batch of products is produced.
______-______-__________ Processing (JIT): A processing system dedicated to having the right amount of materials, parts, or products arrive as they are needed, thereby reducing the amount of inventory.
Activity-Based ____________: Extends ABC from product costing to a comprehensive management tool that focuses on reducing costs and improving processes and decision-making.
3rd Element of JIT Processing: A ______ _________ control system.
_______ ________: Any factor or activity that has a direct cause-effect relationship with the resources consumed.
Step #2 of ABC: ________ the cost driver that has a strong correlation to the costs accumulated in each cost pool and estimate total annual cost driver usage.
Step #4 of ABC: ___________ overhead costs to products using the overhead rates determined for each cost pool and each product's use of each cost driver.
Value-________ Activity: An activity that increases the perceived value of a product or service to a customer.