Question 1

Which of the following methods of determining cost behavior uses average account values and average driver values to calculate fixed costs and variable rates?

Accepted Answer

A) The industrial value costing method 
B) The account analysis method 
C) The learning average curve model 
D) The confidence interval driver model 
A) The industrial value costing method 
B) The account analysis method 
C) The learning average curve model 
D) The confidence interval driver model

Question 2

Committed resources

Accepted Answer

A) are supplied as needed. 
B) are acquired by a contract for the exact amount of their usage. 
C) may exceed the demand for their usage. 
D) all of the above. 
A) are supplied as needed. 
B) are acquired by a contract for the exact amount of their usage. 
C) may exceed the demand for their usage. 
D) all of the above.

Question 3

Costs in marketing, distribution, and service after the sale _________ as number of units produced and sold _________.

Accepted Answer

The answer of Costs in marketing, distribution, and service after...

Question 4

The experience curve relates cost to increased efficiency, such that the more a task is performed, the lower the cost of doing will be.

Accepted Answer

A) True 
 B)False

Question 5

The following cost functions were developed for manufacturing overhead costs: $$\begin{array} { l l } 
\text { Manufacturing Overhead Cost } & \text { Cost Function } \\hline
\text { Electricity } & \$ 200 + \$ 20 \text { per direct labor hour } \
\text { Maintenance } & \$ 400 + \$ 30 \text { per direct labor hour } \
\text { Supervisors' salaries } & \$ 20,000 \text { per month } \
\text { Indirect materials } & \$ 16 \text { per direct labor hour }
\end{array}$$ If January production is expected to be 2,000 units requiring 3,000 direct labor hours, estimated manufacturing overhead costs would be

Accepted Answer

A) $20,733. 
B) $198,000. 
C) $152,600. 
D) $218,600. 
A) $20,733. 
B) $198,000. 
C) $152,600. 
D) $218,600.

Question 6

The cost function derived by the least-squares cost estimation method

Accepted Answer

A) is linear. 
B) must be tested for minima and maxima. 
C) is parabolic. 
D) is quadratic. 
A) is linear. 
B) must be tested for minima and maxima. 
C) is parabolic. 
D) is quadratic.

Question 7

__________ explain changes in cost factors other than changes in units produced.

Accepted Answer

Non-unit-b

Question 8

Drivers that explain changes in costs as factors other than changes in units produced are called:

Accepted Answer

A) Functional based cost drivers 
B) Non-unit-based cost drivers 
C) Unit-based cost drivers 
D) None of these 
A) Functional based cost drivers 
B) Non-unit-based cost drivers 
C) Unit-based cost drivers 
D) None of these

Question 9

The annual expenses associated with the multi-period category is independent of actual usage of the resource and are referred to as:

Accepted Answer

A) variable costs. 
B) committed fixed expenses. 
C) mixed costs. 
D) overhead expenses. 
A) variable costs. 
B) committed fixed expenses. 
C) mixed costs. 
D) overhead expenses.

Question 10

The range of activity within which a linear cost function is valid is called the

Accepted Answer

A) normal range. 
B) relevant range. 
C) activity range. 
D) none of these. 
A) normal range. 
B) relevant range. 
C) activity range. 
D) none of these.

Question 11

Finding a strong statistical association between an activity cost and an activity driver can provide evidence to managers about the correctness of a driver selection.

Accepted Answer

A) True 
 B)False

Question 12

The Sandoval Company has four process engineers that are each able to process 1,500 design changes. Last year 5,250 design changes were produced by the four engineers. Each engineer is paid $60,000 per year. Calculate the activity rate per change order.

Accepted Answer

A) $4 per change order 
B) $10 per change order 
C) $40 per change order 
D) $15 per change order 
A) $4 per change order 
B) $10 per change order 
C) $40 per change order 
D) $15 per change order

Question 13

Assume the following information: $$\begin{array} { l l } 
\text { Volume } & \text { Total Cost } \
\hline 100 \text { units } & \$ 1,300 \
90 \text { units } & \$ 1,500 \
106 \text { units } & \$ 1,750
\end{array}$$ What is the variable cost per unit? (Round your answer to three decimal places.)

Accepted Answer

A) $15.625 
B) $28.125 
C) $13.175 
D) $20.178 
A) $15.625 
B) $28.125 
C) $13.175 
D) $20.178

Question 14

The following computer printout estimated overhead costs using regression: $\begin{array}{ccccc}
&\text {$t \text { for } H(0)$ }&&&\text { Std. error}\
 \text {Parameter }& \text { Estimate}& \text { Parameter $ =0 $ }&\text {$ \operatorname{Pr} >\mathrm{t} $ }& \text {of parameter }\
\text { Intercept } & 100.41 & 4.81 & 0.0003 & 20.88 \
\text { DLH } & 14.05 & 6.78 & 0.0001 & 2.07
\end{array}$

$\begin{array}{cc}
\text { R Square (R2) } & 0.80 \
\text { Standard Error (Se) } & 25.03 \
\text { Observations } & 17
\end{array}$
Please find the following statistical table
$\begin{array}{|c|c|c|c|c|c|c|c|}
\hline \begin{array}{c}
\text { degrees } \
\text { of freed om }
\end{array} & 90 \% & 95 \% & \mathbf{9 9 \%} & \begin{array}{c}
\text { degrees of } \
\text { freedom }
\end{array} & \mathbf{9 0 \%} & \mathbf{9 5 \%} & \mathbf{9 9 \%} \
\hline 1 & 6.314 & 12.708 & 63.657 & 11 & 1.796 & 2.201 & 3.106 \
\hline 2 & 2.920 & 4.303 & 9.925 & 12 & 1.782 & 2.179 & 3.055 \
\hline 3 & 2.353 & 3.182 & 5.841 & 13 & 1.771 & 2.160 & 3.055 \
\hline 4 & 2.132 & 2.776 & 4.604 & 14 & 1.761 & 2.145 & 3.012 \
\hline 5 & 2.015 & 2.571 & 4.032 & 15 & 1.753 & 2.131 & 2.947 \
\hline 6 & 1.943 & 2.447 & 3.707 & 16 & 1.746 & 2.120 & 2.921 \
\hline 7 & 1.895 & 2.365 & 3.499 & 17 & 1.740 & 2.110 & 2.898 \
\hline 8 & 1.860 & 2.306 & 3.355 & 18 & 1.734 & 2.101 & 2.878 \
\hline 9 & 1.833 & 2.262 & 3.250 & 19 & 1.729 & 2.093 & 2.861 \
\hline 10 & 1.812 & 2.228 & 3.169 & 20 & 1.725 & 2.086 & 2.845\
\hline
\end{array}$
During the last accounting period 10,000 DLH were worked.
The hypothesis tests of the cost parameters indicate(s) that

Accepted Answer

A) the slope is significantly different from zero. 
B) the intercept is significantly different from zero. 
C) both the slope and intercept are not significant. 
D) both the slope and intercept are significant. 
A) the slope is significantly different from zero. 
B) the intercept is significantly different from zero. 
C) both the slope and intercept are not significant. 
D) both the slope and intercept are significant.

Question 15

The scatterplot method of cost estimation

Accepted Answer

A) is influenced by extreme observations. 
B) requires the use of judgment. 
C) uses the least-squares method. 
D) is superior to other methods in its ability to distinguish between discretionary and committed fixed costs. 
A) is influenced by extreme observations. 
B) requires the use of judgment. 
C) uses the least-squares method. 
D) is superior to other methods in its ability to distinguish between discretionary and committed fixed costs.

Question 16

The _________ method may be used to determine the activities and amounts for cost behavior.

Accepted Answer

industrial

Question 17

Which of the following statements is true about confidence intervals?

Accepted Answer

A) It measures the degree of association between cost and activity output. 
B) It determines which activities are needed to complete a process. 
C) It consists of a single point and actual cost will always coincide with predicted cost. 
D) It indicates whether the parameters are different from zero. 
A) It measures the degree of association between cost and activity output. 
B) It determines which activities are needed to complete a process. 
C) It consists of a single point and actual cost will always coincide with predicted cost. 
D) It indicates whether the parameters are different from zero.

Question 18

A feature of regression routines, not provided by the scatter plot of high-low methods, is to provide information to and in the assessment of reliability of the estimated costs formula.

Accepted Answer

A) True 
 B)False

Question 19

The confidence interval for the predicted value of Y

Accepted Answer

A) is a measure of the likelihood that the prediction interval will not contain the actual cost. 
B) is constructed by multiplying the t-statistic times the standard error. 
C) can only be computed with 95 percent confidence. 
D) all of the above. 
A) is a measure of the likelihood that the prediction interval will not contain the actual cost. 
B) is constructed by multiplying the t-statistic times the standard error. 
C) can only be computed with 95 percent confidence. 
D) all of the above.

Question 20

Total costs may be computed as follows:

Accepted Answer

A) Fixed costs + (Variable costs per unit × Unit volume) 
B) (Fixed costs per unit × Unit volume) + Variable costs 
C) Fixed costs per unit + (Variable costs per unit × Unit volume) 
D) (Fixed costs per unit × Unit volume) + Variable costs per unit 
A) Fixed costs + (Variable costs per unit × Unit volume) 
B) (Fixed costs per unit × Unit volume) + Variable costs 
C) Fixed costs per unit + (Variable costs per unit × Unit volume) 
D) (Fixed costs per unit × Unit volume) + Variable costs per unit

Which of the following methods of determining cost behavior uses average account values and average driver values to calculate fixed costs and variable rates?

Committed resources

Costs in marketing, distribution, and service after the sale _ as number of units produced and sold _.

The experience curve relates cost to increased efficiency, such that the more a task is performed, the lower the cost of doing will be.

The cost function derived by the least-squares cost estimation method

__________ explain changes in cost factors other than changes in units produced.

Drivers that explain changes in costs as factors other than changes in units produced are called:

The annual expenses associated with the multi-period category is independent of actual usage of the resource and are referred to as:

The range of activity within which a linear cost function is valid is called the

Finding a strong statistical association between an activity cost and an activity driver can provide evidence to managers about the correctness of a driver selection.

The Sandoval Company has four process engineers that are each able to process 1,500 design changes. Last year 5,250 design changes were produced by the four engineers. Each engineer is paid $60,000 per year. Calculate the activity rate per change order.

Assume the following information: Volume Total Cost 100 units \ 1,300 90 units \ 1,500 106 units \ 1,750 What is the variable cost per unit? (Round your answer to three decimal places.)

The scatterplot method of cost estimation

The _________ method may be used to determine the activities and amounts for cost behavior.

Which of the following statements is true about confidence intervals?

A feature of regression routines, not provided by the scatter plot of high-low methods, is to provide information to and in the assessment of reliability of the estimated costs formula.

The confidence interval for the predicted value of Y

Total costs may be computed as follows:

Introduction to Cost Management

Basic Cost Management Concepts

Activity-Based Costing

Product and Service Costing: Job-Order System

Process Costing

Allocating Costs of Support Departments and Joint Products

Budgeting for Planning and Control

Standard Costing: a Functional-Based Control Approach

Decentralization: Responsibility Accounting, Performance

Strategic Cost Management

Activity-Based Management

The Balanced Scorecard: Strategic-Based Control

Quality and Environmental Cost Management

Lean Accounting and Productivity Measurement

Cost-Volume-Profit Analysis

Activity Resource Usage Model and Tactical Decision Making

Pricing and Profitability Analysis

Capital Investment

Inventory Management: Economic Order Quantity, Jit, and the Theory of Constraints

Filters

Exam 3: Cost Behavior

Which of the following methods of determining cost behavior uses average account values and average driver values to calculate fixed costs and variable rates?

Committed resources

Costs in marketing, distribution, and service after the sale _________ as number of units produced and sold _________.

The experience curve relates cost to increased efficiency, such that the more a task is performed, the lower the cost of doing will be.

The cost function derived by the least-squares cost estimation method

__________ explain changes in cost factors other than changes in units produced.

Drivers that explain changes in costs as factors other than changes in units produced are called:

The annual expenses associated with the multi-period category is independent of actual usage of the resource and are referred to as:

The range of activity within which a linear cost function is valid is called the

Finding a strong statistical association between an activity cost and an activity driver can provide evidence to managers about the correctness of a driver selection.

The Sandoval Company has four process engineers that are each able to process 1,500 design changes. Last year 5,250 design changes were produced by the four engineers. Each engineer is paid $60,000 per year. Calculate the activity rate per change order.

Assume the following information: Volume Total Cost 100 units \ 1,300 90 units \ 1,500 106 units \ 1,750 What is the variable cost per unit? (Round your answer to three decimal places.)

The scatterplot method of cost estimation

The _________ method may be used to determine the activities and amounts for cost behavior.

Which of the following statements is true about confidence intervals?

A feature of regression routines, not provided by the scatter plot of high-low methods, is to provide information to and in the assessment of reliability of the estimated costs formula.

The confidence interval for the predicted value of Y

Total costs may be computed as follows:

Introduction to Cost Management

Basic Cost Management Concepts

Activity-Based Costing

Product and Service Costing: Job-Order System

Process Costing

Allocating Costs of Support Departments and Joint Products

Budgeting for Planning and Control

Standard Costing: a Functional-Based Control Approach

Decentralization: Responsibility Accounting, Performance

Strategic Cost Management

Activity-Based Management

The Balanced Scorecard: Strategic-Based Control

Quality and Environmental Cost Management

Lean Accounting and Productivity Measurement

Cost-Volume-Profit Analysis

Activity Resource Usage Model and Tactical Decision Making

Pricing and Profitability Analysis

Capital Investment

Inventory Management: Economic Order Quantity, Jit, and the Theory of Constraints

Filters

Costs in marketing, distribution, and service after the sale _ as number of units produced and sold _.