Value stream costing eliminates most of the transactions associated with convent
ID: 2574808 • Letter: V
Question
Value stream costing eliminates most of the transactions associated with conventional cost accounting because it ...
makes more extensive use of standard costing.
gathers and reports financial data in summary form at the value stream level rather than for each production job or product.
automates financial reporting processes.
uses more detailed and accurate overhead cost allocations than standard costing.
In value stream costing, the labor costs assigned to a value stream ...
include the costs of all personnel assigned to the value stream, plus allocations for support staff in all departments that support the value stream.
include the costs of all personnel assigned to the value stream, but few if any allocations for any support staff outside the value stream.
include the costs of all direct and indirect labor hours in the value stream, plus allocations of staff outside the value stream providing production support; but exclude any sales, marketing, or administrative personnel in the value stream.
include the costs of all direct and indirect labor hours in the value stream, but exclude the costs of any sales, marketing or administrative personnel in the value stream.
Value stream costing simplifies accounting in part by ...
centralizing and consolidating the purchasing function.
increasing the number of cost centers to more easily expose cost overruns.
allocating all overhead using actual direct labor hours or machine hours rather than relying on more complex calculations.
eliminating detailed labor reporting, including the distinction between direct and indirect labor.
When using value stream costing, managers evaluate decisions about product rationalization (keeping or dropping a product) by ...
examining the effects on overall value stream results of continuing to produce and sell a product versus dropping it.
comparing the production cost per unit of all products in the value stream.
disregarding the financial impact, and examining instead the effects on the value stream operating measures shown in the box score of continuing to produce and sell a product versus dropping it.
comparing the gross profit margins for all products.
Exotic Chocolates had material costs of $24,000 and conversion costs of $18,000 in their most recent month containing 20 working days. At the end of the month, Exotic Chocolates had material on hand equal to six days of production, work-in-process equal to three days of production, and finished goods equal to eight days of production. The value for ending inventory using the “days of stock” method is ...
$ 28,950
$ 32,550
$ 35,700
$ 42,000
Which of the following is an example of a good use of the value stream box score?
Plant and division managers using the box score analyze variances from budgeted standard costs.
Plant and division managers using the box score to encourage and evaluate the results of competition between their value streams for best overall performance.
Value stream continuous improvement teams using the box score to design high-impact kaizen events and improvement plans.
Employees in the production cells using the box score to manage daily performance.
The box score measures three dimensions of performance in the value stream: operational, financial, and ...
quality.
capacity.
flow.
strategic.
Displaying actual value stream results in a box score with a column for each week in a quarter is a good way to use the box score to ...
show the effects of planned lean improvements.
track value stream performance and continuous improvement.
evaluate the effect of tactical decision alternatives, such as accepting a special order.
evaluate the effect of management decision alternatives, such as adding a product line.
Displaying current state performance and future states based on the expected results of pursuing different strategy alternatives. is a good way to use the box score to ...
evaluate the effect of strategic decision alternatives, such as adding a product line.
track value stream performance and continuous improvement.
show the effects of planned lean improvements.
show the impact of actual lean improvements.
A good way to use the box score to evaluate the impact of lean improvements is to ...
display current state performance and a future state based on planned improvements.
display current state performance and future states based on the expected results of pursuing different strategy alternatives.
display actual box score results for all the weeks in a quarter to show the trends in performance.
display current performance for the most current week or month, without reference to expected future states or performance trends.
A.makes more extensive use of standard costing.
B.gathers and reports financial data in summary form at the value stream level rather than for each production job or product.
C.automates financial reporting processes.
D.uses more detailed and accurate overhead cost allocations than standard costing.
Explanation / Answer
.1.Answer: B
Value stream costing is to find out process stream which provide value to customers and find the cost of the process steps providing value.
Traditional costing system allocate costs to the products including cost of wastes. Standard costing or other traditional costing systems hide wastes but value stream costing reveals waste.
.2.Answer:A
In value stream costing labor costs assigned to the value stream includes all personnel cost associated with the value stream including production and support staff.
The costs includes maintenance, engineering, purchase, accounting, customer service etc.
.3. Answer:D
Value stream costing supports lean production. It simplifies costing system and eliminates wasteful data collection and detailed reporting & allocation.
.4. Answer: A
In value stream costing the decision on product rationalization are taken based on effects on overall value stream results. Product costs are not determined.
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