Exam 3: Cost Behavior

A manufacturing company pays an assembly line worker $12 per hour. What is the proper classification of this labor cost?

_________ is useful when the dependent variable is affected by more than one independent variable.

For each of the following situations, draw a graph that best describes the cost behavior pattern. The vertical axis represents costs, and the horizontal axis represents volume. a.Direct materials per unit b.Depreciation expense on a building per unit c.An employee paid $50 per hour with a guaranteed salary of $1,000 per week d.A consultant paid $100 per hour with a maximum fee of $2,000 e.Salaries of teachers where each teacher can handle a maximum of 15 students

When a cost behavior pattern does not follow a linear pattern, a non linear cost curve is used called the _________ curve.

Which of the following is NOT a correct statement concerning cost behavior?

In the formula Y = F + VX, F refers to the

Hereford Company is planning to introduce a new product with an 80 percent learning rate for production for batches of 1,000 units. The variable labor costs are $30 per unit for the first 1,000-unit batch. Each batch requires 100 hours. There are $10,000 in fixed costs not subject to learning. What is the batch unit time (labor hours) to produce 2,000 units based on the cumulative average time learning curve?

Resources, such as direct materials, direct labor, electricity, equipment, and so on, are economic elements that enable one to perform activities.

In the method of least squares, the deviation is the difference between the

The __________ method is used whenever least squares is used to fit an equation involving two or more independent variables.

The method of least squares requires a _________ in order to be utilized.

The appropriate range for the coefficient of correlation (r) is

The hypothesis test of cost parameters indicates whether the parameters are different from _________.

What does a correlation coefficient near 0 mean?

Cumulative average-time _________ curve assumes the cumulative average time per unit decreases by a constant percentage each time the cumulative quantity of units produced doubles.

The following computer printout estimated overhead costs using regression: t for H(0) Std. error Parameter Estimate Parameter =0 Pr > of parameter Intercept 100.41 4.81 0.0003 20.88 DLH 14.05 6.78 0.0001 2.07 R Square (R2) 0.80 Standard Error (Se) 25.03 Observations 17 Please find the following statistical table degrees of freed om 90\% 95\% degrees of freedom 1 6.314 12.708 63.657 11 1.796 2.201 3.106 2 2.920 4.303 9.925 12 1.782 2.179 3.055 3 2.353 3.182 5.841 13 1.771 2.160 3.055 4 2.132 2.776 4.604 14 1.761 2.145 3.012 5 2.015 2.571 4.032 15 1.753 2.131 2.947 6 1.943 2.447 3.707 16 1.746 2.120 2.921 7 1.895 2.365 3.499 17 1.740 2.110 2.898 8 1.860 2.306 3.355 18 1.734 2.101 2.878 9 1.833 2.262 3.250 19 1.729 2.093 2.861 10 1.812 2.228 3.169 20 1.725 2.086 2.845 During the last accounting period 10,000 DLH were worked. What is the model?

Assuming costs are represented on the vertical axis and volume of activity on the horizontal axis, which of the following costs would be represented by a line that starts at the origin and reaches a maximum value beyond which the line is parallel to the horizontal axis?

The graph showing the relationship between activity costs and drivers/outputs is called the _________.

As the volume of activity increases within the relevant range, the variable cost per unit

When least squares is used to fit an equation involving two or more independent variables, the method is called _____.