Question 1

The high-low method

Accepted Answer

A) is the most accurate methods. 
B) is not affected by the presence of outliers. 
C) has the advantage of objectivity. 
D) has the advantage of subjectivity. 
A) is the most accurate methods. 
B) is not affected by the presence of outliers. 
C) has the advantage of objectivity. 
D) has the advantage of subjectivity.

Question 2

Managerial judgment is critically important in determining cost behavior.

Accepted Answer

A) True 
 B)False

Question 3

Coefficients shown by a regression program are:
   Required:

Accepted Answer

The answer of Coefficients shown by a regression program are:
...

Question 4

The following six months of data were collected on electricity cost and the number of machine hours in a factory.
   Required:

Accepted Answer

The answer of The following six months of data were...

Question 5

Figure 3-14. Blacken Company manufactures motorcycles.The company's management accountant wants to calculate the fixed and variable costs associated with utility cost incurred by the factory.Data for the past five months were collected.
  Refer to Figure 3-14.Using a regression program,the forecasted utility cost at 2,550 machine hours (rounded to the nearest dollar)is

Accepted Answer

A) $28,288. 
B) $37,116. 
C) $33,147. 
D) $10,631. 
A) $28,288. 
B) $37,116. 
C) $33,147. 
D) $10,631.

Question 6

Arcadia Company incurred the following costs and machine hours during the first three months of the current year.Assume that the driver for all costs is machine hours.
   Required:

Accepted Answer

The answer of Arcadia Company incurred the following costs and...

Question 7

Figure 3-2.   Refer to Figure 3-2.What is the materials cost per unit of output?

Accepted Answer

A) $.10 
B) $.20 
C) $.60 
D) $.40 
A) $.10 
B) $.20 
C) $.60 
D) $.40

Question 8

Figure 3-6. Taran Company incurred the following costs for the months of January and February.
  Refer to Figure 3-6.Assume that output was 5,000 units in January and 10,000 units in February,utility cost is a mixed cost,and the fixed cost of utilities was $3,000.What was the variable rate per unit of output for utilities cost?

Accepted Answer

A) $.60 
B) $.40 
C) $.20 
D) $.30 
A) $.60 
B) $.40 
C) $.20 
D) $.30

Question 9

Figure 3-9. The following cost formula was developed using monthly data for a retail clothing store.
Total cost = $75,620 + ($242 ´ number of customers)
Refer to Figure 3-9.The term "total cost"

Accepted Answer

A) is the independent variable. 
B) is the dependant variable. 
C) is the intercept. 
D) is the variable rate. 
A) is the independent variable. 
B) is the dependant variable. 
C) is the intercept. 
D) is the variable rate.

Question 10

A fixed cost within the relevant range

Accepted Answer

A) increases in total as output decreases. 
B) does not change in total as output changes. 
C) decreases in total as output increases. 
D) all of these are correct 
A) increases in total as output decreases. 
B) does not change in total as output changes. 
C) decreases in total as output increases. 
D) all of these are correct

Question 11

A factor that causes or leads to a change in a cost or activity is a(n)

Accepted Answer

A) cost formula. 
B) step cost. 
C) mixed cost. 
D) driver. 
A) cost formula. 
B) step cost. 
C) mixed cost. 
D) driver.

Question 12

"Outliers" are points that seem to fit the general pattern of behavior.

Accepted Answer

A) True 
 B)False

Question 13

Depreciation on factory equipment would be an example of a _________.

Accepted Answer

The answer of Depreciation on factory equipment would be an...

Question 14

If production volume increases from 8,000 to 10,000 units,

Accepted Answer

A) total costs will increase by 20%. 
B) total costs will increase by 25%. 
C) total variable costs will increase by 25%. 
D) mixed and variable costs will increase by 25%. 
A) total costs will increase by 20%. 
B) total costs will increase by 25%. 
C) total variable costs will increase by 25%. 
D) mixed and variable costs will increase by 25%.

Question 15

Figure 3-5. Maxwell Company makes treadmills.The company controller wants to calculate the fixed and variable costs associated with the janitorial costs incurred in the factory.Data for the past four months were collected.
  Refer to Figure 3-5.What would Maxwell Company's estimate of total janitorial cost be at a level of 600 machine hours?

Accepted Answer

A) $11,280 
B) $7,500 
C) $4,080 
D) $6,120 
A) $11,280 
B) $7,500 
C) $4,080 
D) $6,120

Question 16

The ________________________ is a variable whose value depends on the value of another variable.

Accepted Answer

The answer of The ________________________ is a variable whose value...

Question 17

Figure 3-14. Blacken Company manufactures motorcycles.The company's management accountant wants to calculate the fixed and variable costs associated with utility cost incurred by the factory.Data for the past five months were collected.
  Refer to Figure 3-14.Using a regression program,the yearly utility cost equation (with all variables to the nearest penny)is

Accepted Answer

A) Total utility cost = $127,569.60 + ($8.83 ´ machine hours) 
B) Total utility cost = $10,630.80 + ($8.83 ´ machine hours) 
C) Total utility cost = $8.83 + ($10,630.80 ´ machine hours) 
D) Total utility cost = $10,630.80 - ($8.83 ´ machine hours) 
A) Total utility cost = $127,569.60 + ($8.83 ´ machine hours) 
B) Total utility cost = $10,630.80 + ($8.83 ´ machine hours) 
C) Total utility cost = $8.83 + ($10,630.80 ´ machine hours) 
D) Total utility cost = $10,630.80 - ($8.83 ´ machine hours)

Question 18

Mixed costs have both a fixed and a variable component.

Accepted Answer

A) True 
 B)False

Question 19

The cost accountant for Bolagio Company used an Excel spreadsheet program to run ordinary least squares on a set of cost data for its utility cost.Bolagio's cost driver for utility cost is machine hours.The following results were produced.
   Required:

Accepted Answer

The answer of The cost accountant for Bolagio Company used...

Question 20

The fabric used to manufacture curtains is an example of a ____________ cost.

Accepted Answer

The answer of The fabric used to manufacture curtains is...

The high-low method

Managerial judgment is critically important in determining cost behavior.

Coefficients shown by a regression program are: Required:

The following six months of data were collected on electricity cost and the number of machine hours in a factory. Required:

Arcadia Company incurred the following costs and machine hours during the first three months of the current year.Assume that the driver for all costs is machine hours. Required:

Figure 3-2. Refer to Figure 3-2.What is the materials cost per unit of output?

Figure 3-9. The following cost formula was developed using monthly data for a retail clothing store. Total cost = $75,620 + ($242 ´ number of customers) Refer to Figure 3-9.The term "total cost"

A fixed cost within the relevant range

A factor that causes or leads to a change in a cost or activity is a(n)

"Outliers" are points that seem to fit the general pattern of behavior.

Depreciation on factory equipment would be an example of a _________.

If production volume increases from 8,000 to 10,000 units,

The ________________________ is a variable whose value depends on the value of another variable.

Mixed costs have both a fixed and a variable component.

The cost accountant for Bolagio Company used an Excel spreadsheet program to run ordinary least squares on a set of cost data for its utility cost.Bolagio's cost driver for utility cost is machine hours.The following results were produced. Required:

The fabric used to manufacture curtains is an example of a ____________ cost.

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing,and Inventory Management

Profit Planning

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 3: Cost Behavior

The high-low method

Managerial judgment is critically important in determining cost behavior.

Coefficients shown by a regression program are: Required:

The following six months of data were collected on electricity cost and the number of machine hours in a factory. Required:

Arcadia Company incurred the following costs and machine hours during the first three months of the current year.Assume that the driver for all costs is machine hours. Required:

Figure 3-2. Refer to Figure 3-2.What is the materials cost per unit of output?

Figure 3-9. The following cost formula was developed using monthly data for a retail clothing store. Total cost = $75,620 + ($242 ´ number of customers) Refer to Figure 3-9.The term "total cost"

A fixed cost within the relevant range

A factor that causes or leads to a change in a cost or activity is a(n)

"Outliers" are points that seem to fit the general pattern of behavior.

Depreciation on factory equipment would be an example of a _________.

If production volume increases from 8,000 to 10,000 units,

The ________________________ is a variable whose value depends on the value of another variable.

Mixed costs have both a fixed and a variable component.

The cost accountant for Bolagio Company used an Excel spreadsheet program to run ordinary least squares on a set of cost data for its utility cost.Bolagio's cost driver for utility cost is machine hours.The following results were produced. Required:

The fabric used to manufacture curtains is an example of a ____________ cost.

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing,and Inventory Management

Profit Planning

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Statement of Cash Flows

Financial Statement Analysis

Filters