Which of the following statements is true of implementing an ABC ...

[jake]

Which of the following statements is true of implementing an ABC system?
 
  A) Managers should never compromise on the cause-and-effect relationship of cost drivers and costs.
  B) The three guidelines for refining costing systems should be ignored while implementing an ABC costing system.
  C) The heterogeneous cost pools give managers greater confidence in the activity and product cost numbers from the ABC system.
  D) Identifying the cost-allocation bases defines the number of activity pools into which costs must be grouped in an ABC system.

Question 2

The prepaid insurance account had a beginning balance of 6,600 and was debited for 2,300 of premiums paid during the year. Journalize the adjusting entry required at the end of the year assuming the amount of unexpired insurance related to future periods is 4,100.

[ASDFGJLO]

Answer to Question 1

Answer: D

Answer to Question 2

Insurance Expense 4,800
Prepaid Insurance 4,800
Insurance expired.
6,600 + 2,300  4,100 = 4,800

[jake]

Correct answers!

[ASDFGJLO]

Great! Please up vote