Question 1

A discretionary fixed cost can be changed relatively easily at management discretion.

Accepted Answer

A) True 
 B)False

Question 2

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 $75,620

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 3

Boswan Company incurred the following costs and machine hours for the months of April and May.
  Required:

Accepted Answer

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

Question 4

Rental expense for a warehouse is an example of a ___________ cost.

Accepted Answer

The answer of Rental expense for a warehouse is an...

Question 5

Select the appropriate cost behavior for each of the costs listed below.
-depreciation

Accepted Answer

A) variable 
B) fixed 
A) variable 
B) fixed

Question 6

Graphically, the ______________ is the point at which the cost line intercepts the cost (vertical) axis.

Accepted Answer

The answer of Graphically, the ______________ is the point at...

Question 7

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 8

Select the appropriate type of fixed cost for each cost listed below.
-rent of building

Accepted Answer

A) discretionary 
B) committed 
A) discretionary 
B) committed

Question 9

Select the appropriate cost behavior for the following costs incurred by an automobile manufacturer.
-cost of inspections

Accepted Answer

A) variable 
B) fixed 
A) variable 
B) fixed

Question 10

The spreadsheet regression program supplies more than the estimates of the coefficients; it also provides information that can be used to see how ________ the cost equation is which is a feature not available for the high-low method.

Accepted Answer

The answer of The spreadsheet regression program supplies more than...

Question 11

The controller of Lamps Limited is concerned about the how much the company's costs have risen over the past few months. Since the majority of the company's costs are mixed, it is hard to tell if the increasing costs are due to variable costs or fixed costs. The controller asks that you research the different ways to separate mixed costs and then to present a report showing the advantages and disadvantages of each method. He would also like you to make a recommendation as to which method should be used.

Accepted Answer

There are three methods of separating a

Question 12

Select the appropriate cost behavior for each of the costs listed below.
-salary of chief executive officer

Accepted Answer

A) variable 
B) fixed 
A) variable 
B) fixed

Question 13

If an automobile manufacturer changes from skilled labor to computer-controlled assembly procedures, the past data

Accepted Answer

A)  are useful in predicting future costs. 
B)  are of little or no value in predicting future costs. 
C)  should be used without adjustments to predict future costs. 
D)  are representative of future costs. 
A)  are useful in predicting future costs. 
B)  are of little or no value in predicting future costs. 
C)  should be used without adjustments to predict future costs. 
D)  are representative of future costs.

Question 14

Tamo Company used an Excel spreadsheet program to run ordinary least squares on a set of cost data for its utility cost. The cost driver for labor cost is employee hours. The following results were produced.
   Required:

Accepted Answer

The answer of Tamo Company used an Excel spreadsheet program...

Question 15

The relevant range

Accepted Answer

A)  is the normal range of output. 
B)  is the range of output where cost relationships are valid. 
C)  may change from period to period. 
D)  All of these are correct. 
A)  is the normal range of output. 
B)  is the range of output where cost relationships are valid. 
C)  may change from period to period. 
D)  All of these are correct.

Question 16

Figure 3-12.The method of least squares was used to develop a cost equation to predict the cost of monthly equipment maintenance. The following computer output was received:
   The driver used was the number of machine hours.
-Refer to Figure 3-12. What is the independent variable of the cost formula for equipment maintenance?

Accepted Answer

A)  number of machine hours 
B)  the variable rate 
C)  the fixed cost 
D)  the total cost 
A)  number of machine hours 
B)  the variable rate 
C)  the fixed cost 
D)  the total cost

Question 17

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...

A discretionary fixed cost can be changed relatively easily at management discretion.

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 $75,620

Boswan Company incurred the following costs and machine hours for the months of April and May. Required:

Rental expense for a warehouse is an example of a ___________ cost.

Select the appropriate cost behavior for each of the costs listed below. -depreciation

Graphically, the ______________ is the point at which the cost line intercepts the cost (vertical) axis.

The high-low method

Select the appropriate type of fixed cost for each cost listed below. -rent of building

Select the appropriate cost behavior for the following costs incurred by an automobile manufacturer. -cost of inspections

The spreadsheet regression program supplies more than the estimates of the coefficients; it also provides information that can be used to see how ________ the cost equation is which is a feature not available for the high-low method.

Select the appropriate cost behavior for each of the costs listed below. -salary of chief executive officer

If an automobile manufacturer changes from skilled labor to computer-controlled assembly procedures, the past data

Tamo Company used an Excel spreadsheet program to run ordinary least squares on a set of cost data for its utility cost. The cost driver for labor cost is employee hours. The following results were produced. Required:

The relevant range

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

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

A discretionary fixed cost can be changed relatively easily at management discretion.

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 $75,620

Boswan Company incurred the following costs and machine hours for the months of April and May. Required:

Rental expense for a warehouse is an example of a ___________ cost.

Select the appropriate cost behavior for each of the costs listed below. -depreciation

Graphically, the ______________ is the point at which the cost line intercepts the cost (vertical) axis.

The high-low method

Select the appropriate type of fixed cost for each cost listed below. -rent of building

Select the appropriate cost behavior for the following costs incurred by an automobile manufacturer. -cost of inspections

The spreadsheet regression program supplies more than the estimates of the coefficients; it also provides information that can be used to see how ________ the cost equation is which is a feature not available for the high-low method.

Select the appropriate cost behavior for each of the costs listed below. -salary of chief executive officer

If an automobile manufacturer changes from skilled labor to computer-controlled assembly procedures, the past data

Tamo Company used an Excel spreadsheet program to run ordinary least squares on a set of cost data for its utility cost. The cost driver for labor cost is employee hours. The following results were produced. Required:

The relevant range

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

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