Exam 16: Managing Costs and Uncertainty

Clarkson Company The following information is provided for Clarkson Company for the month of September: Refer to Clarkson Company.What is the efficiency variance?

Spending levels in prior years are often the basis of

Davis Corporation Davis Corporation manufactures and sells baseball bats.For a recent period,its production and sales objectives were each set at 20,000 units.Also,for this period the firm had estimated costs as follows: Refer to Davis Corporation.For this question only,assume that Davis Corporation actually produced and sold 18,000 baseball bats.Davis Corporation's operations for the period would (on an overall basis)be regarded as efficient if total costs were below what amount?

Avoidable costs are usually

Maintaining excessive cash may reduce firm profitability because of low returns on cash investments.

Clarkson Company The following information is provided for Clarkson Company for the month of September: Refer to Clarkson Company.What is the volume variance?

Increasing the discount period on accounts receivable will increase an organization's cash levels.

Careful analysis of the capital budget is an important control activity for

Explain the meaning of the coefficient of determination in cost estimation.

When the organizational output is difficult to define,management may rely on ____ for cost control.

Which of the following is least likely to be a discretionary cost?

A company would be reducing its discretionary costs if it

When budgeting for discretionary costs,less is always better.

For cost control purposes,actual costs should be compared to prior period costs.

Current assets minus current liabilities equals ___________________________.

Accelerating inventory turnover will increase an organization's levels of cash.

Finding acceptable alternatives to higher cost items or not spending money for goods and services is referred to as ________________________________.

Which of the following is likely to be a discretionary cost in most organizations?

The maximum allowable expenditure is the

All of the following are explanations of cost changes.Which of these influences can be substantially affected by cost containment measures?