Question 1

Contribution margin income statements organize costs by behavior.

Accepted Answer

A) True 
 B)False

Question 2

With respect to total fixed costs,which of the following statements is true?

Accepted Answer

A) They will remain the same as production levels change within the relevant range. 
B) They will increase as production decreases within the relevant range. 
C) They will decrease as production increases within the relevant range. 
D) They will decrease as production decreases within the relevant range. 
A) They will remain the same as production levels change within the relevant range. 
B) They will increase as production decreases within the relevant range. 
C) They will decrease as production increases within the relevant range. 
D) They will decrease as production decreases within the relevant range.

Question 3

Maintenance costs at Wilmington Manufacturing over the past six months are listed in the following table.
 
Using the high-low method,what would the monthly fixed maintenance cost be?

Accepted Answer

A) $1,200 
B) $2,320 
C) $13,680 
D) $27,440 
A) $1,200 
B) $2,320 
C) $13,680 
D) $27,440

Question 4

The tennis club where you play tennis charges $50.00 per month and $10.00 per hour of court time.If your current month's bill is $100.00,how many hours of court time did you use?

Accepted Answer

A) 5 hours 
B) 10 hours 
C) 8 hours 
D) 2 hours 
A) 5 hours 
B) 10 hours 
C) 8 hours 
D) 2 hours

Question 5

Total mixed cost is represented by which of the following equations?

Accepted Answer

A) y = vx 
B) y = vx + f 
C) y = f 
D) y = v + f 
A) y = vx 
B) y = vx + f 
C) y = f 
D) y = v + f

Question 6

Variable costs are described by which of the following statements?

Accepted Answer

A) They vary per unit of output. 
B) They are fixed in total. 
C) They are fixed per unit and vary in total. 
D) They decrease per unit as production volume increases. 
A) They vary per unit of output. 
B) They are fixed in total. 
C) They are fixed per unit and vary in total. 
D) They decrease per unit as production volume increases.

Question 7

Match the term on the right with the appropriate definition provided on the right.

Accepted Answer

The answer of Match the term on the right with...

Question 8

Tasty Treats is a snow cone stand near the local park.To plan for the future,Tasty Treats wants to determine its cost behavior patterns.It has the following information available about its operating costs and the number of snow cones served.
 
The variable cost per snow cone using the high-low method is

Accepted Answer

A) $1.43. 
B) $0.70. 
C) $0.90. 
D) $0.94. 
A) $1.43. 
B) $0.70. 
C) $0.90. 
D) $0.94.

Question 9

It costs Homer's Manufacturing $0.75 to produce baseballs and Homer sells them for $4.00 a piece.Homer pays a sales commission of 5% of sales revenue to his sales staff.Homer also pays $12,000 a month rent for his factory and store,and also pays $75,000 a month to his staff in addition to the commissions.Homer sold 67,500 baseballs in June.If Homer prepares a contribution margin income statement for the month of June,what would be his operating income?

Accepted Answer

A) $292,875 
B) $270,000 
C) $64,125 
D) $118,875 
A) $292,875 
B) $270,000 
C) $64,125 
D) $118,875

Question 10

Under variable costing,all nonmanufacturing costs are treated as inventoriable product costs.

Accepted Answer

A) True 
 B)False

Question 11

To follow is information about the units produced and total manufacturing costs for Pine Enterprises for the past six months.
 
Using the high-low method,what is the monthly fixed manufacturing cost?

Accepted Answer

A) $3,900 
B) $14,650 
C) $1,650 
D) $4,250 
A) $3,900 
B) $14,650 
C) $1,650 
D) $4,250

Question 12

The data points with the ________ should be selected for use in calculating the variable cost per unit and the total fixed costs when using the high-low method.

Accepted Answer

A) highest cost and the lowest cost 
B) highest volume and the lowest volume 
C) highest volume and the lowest cost 
D) highest cost and the lowest volume 
A) highest cost and the lowest cost 
B) highest volume and the lowest volume 
C) highest volume and the lowest cost 
D) highest cost and the lowest volume

Question 13

Total mixed costs can be expressed as y = vx,where y = total variable cost,v = variable cost per unit of activity,and x = volume of activity.

Accepted Answer

A) True 
 B)False

Question 14

Checak Incorporated wanted to determine the relationship between its monthly operating costs and a potential cost driver,machine hours.The output of a regression analysis showed the following information (note: only a portion of the regression analysis results is presented here):  
What is closest to the total cost if the firm uses 6,000 machine hours?

Accepted Answer

A) $7,257.49 
B) $6,538.90 
C) $14,729,732.60 
D) $1,365.59 
A) $7,257.49 
B) $6,538.90 
C) $14,729,732.60 
D) $1,365.59

Question 15

By increasing ________,a manager can increase operating income under absorption costing.

Accepted Answer

A) variable costs 
B) fixed costs 
C) production 
D) leased assets 
A) variable costs 
B) fixed costs 
C) production 
D) leased assets

Question 16

In the equation y = $11.75x + $550,"x" represents

Accepted Answer

A) number of units produced. 
B) total fixed costs. 
C) total costs. 
D) none of the above. 
A) number of units produced. 
B) total fixed costs. 
C) total costs. 
D) none of the above.

Question 17

Total fixed costs for Green Planes Inc.are $120,000.Total costs,including both fixed and variable,are $600,000 if 150,000 units are produced.The total variable costs at a level of 220,000 units would be

Accepted Answer

A) $409,091. 
B) $176,000. 
C) $880,000. 
D) $704,000. 
A) $409,091. 
B) $176,000. 
C) $880,000. 
D) $704,000.

Question 18

If a manager sees a potential outlier in the data,he or she should first determine whether the data is correct.

Accepted Answer

A) True 
 B)False

Question 19

When the number of units produced is less than the number of units sold,how does operating income under variable costing differ from operating income under absorption costing?

Accepted Answer

A) It is lower than operating income under absorption costing. 
B) It is higher than operating income under absorption costing. 
C) It is the same as operating income under absorption costing. 
D) It depends upon the amount of decline. 
A) It is lower than operating income under absorption costing. 
B) It is higher than operating income under absorption costing. 
C) It is the same as operating income under absorption costing. 
D) It depends upon the amount of decline.

Question 20

Best Birdies produces ornate birdcages.The company's average cost per unit is $18.00 when it produces 2,200 birdcages.If $5,500 of the total costs are fixed,what is the variable cost of producing each birdcage?

Accepted Answer

A) $2.50 
B) $34,100 
C) $18.00 
D) $15.50 
A) $2.50 
B) $34,100 
C) $18.00 
D) $15.50

Contribution margin income statements organize costs by behavior.

With respect to total fixed costs,which of the following statements is true?

Maintenance costs at Wilmington Manufacturing over the past six months are listed in the following table. Using the high-low method,what would the monthly fixed maintenance cost be?

The tennis club where you play tennis charges $50.00 per month and $10.00 per hour of court time.If your current month's bill is $100.00,how many hours of court time did you use?

Total mixed cost is represented by which of the following equations?

Variable costs are described by which of the following statements?

Match the term on the right with the appropriate definition provided on the right.

Under variable costing,all nonmanufacturing costs are treated as inventoriable product costs.

To follow is information about the units produced and total manufacturing costs for Pine Enterprises for the past six months. Using the high-low method,what is the monthly fixed manufacturing cost?

The data points with the ________ should be selected for use in calculating the variable cost per unit and the total fixed costs when using the high-low method.

Total mixed costs can be expressed as y = vx,where y = total variable cost,v = variable cost per unit of activity,and x = volume of activity.

By increasing ________,a manager can increase operating income under absorption costing.

In the equation y = $11.75x + $550,"x" represents

Total fixed costs for Green Planes Inc.are $120,000.Total costs,including both fixed and variable,are $600,000 if 150,000 units are produced.The total variable costs at a level of 220,000 units would be

If a manager sees a potential outlier in the data,he or she should first determine whether the data is correct.

When the number of units produced is less than the number of units sold,how does operating income under variable costing differ from operating income under absorption costing?

Best Birdies produces ornate birdcages.The company's average cost per unit is $18.00 when it produces 2,200 birdcages.If $5,500 of the total costs are fixed,what is the variable cost of producing each birdcage?

Introduction to Managerial Accounting

Building Blocks of Managerial Accounting

Job Costing

Activity-Based Costing, lean Operations, and the Costs of Quality

Process Costing

Cost-Volume-Profit Analysis

Relevant Costs for Short-Term Decisions

The Master Budget

Performance Evaluation

Standard Costs and Variances

Capital Investment Decisions and the Time Value of Money

Statement of Cash Flows

Financial Statement Analysis

Sustainability

Filters

Exam 6: Cost Behavior

Contribution margin income statements organize costs by behavior.

With respect to total fixed costs,which of the following statements is true?

Maintenance costs at Wilmington Manufacturing over the past six months are listed in the following table. Using the high-low method,what would the monthly fixed maintenance cost be?

The tennis club where you play tennis charges $50.00 per month and $10.00 per hour of court time.If your current month's bill is $100.00,how many hours of court time did you use?

Total mixed cost is represented by which of the following equations?

Variable costs are described by which of the following statements?

Match the term on the right with the appropriate definition provided on the right.

Under variable costing,all nonmanufacturing costs are treated as inventoriable product costs.

To follow is information about the units produced and total manufacturing costs for Pine Enterprises for the past six months. Using the high-low method,what is the monthly fixed manufacturing cost?

The data points with the ________ should be selected for use in calculating the variable cost per unit and the total fixed costs when using the high-low method.

Total mixed costs can be expressed as y = vx,where y = total variable cost,v = variable cost per unit of activity,and x = volume of activity.

By increasing ________,a manager can increase operating income under absorption costing.

In the equation y = $11.75x + $550,"x" represents

Total fixed costs for Green Planes Inc.are $120,000.Total costs,including both fixed and variable,are $600,000 if 150,000 units are produced.The total variable costs at a level of 220,000 units would be

If a manager sees a potential outlier in the data,he or she should first determine whether the data is correct.

When the number of units produced is less than the number of units sold,how does operating income under variable costing differ from operating income under absorption costing?

Best Birdies produces ornate birdcages.The company's average cost per unit is $18.00 when it produces 2,200 birdcages.If $5,500 of the total costs are fixed,what is the variable cost of producing each birdcage?

Introduction to Managerial Accounting

Building Blocks of Managerial Accounting

Job Costing

Activity-Based Costing, lean Operations, and the Costs of Quality

Process Costing

Cost-Volume-Profit Analysis

Relevant Costs for Short-Term Decisions

The Master Budget

Performance Evaluation

Standard Costs and Variances

Capital Investment Decisions and the Time Value of Money

Statement of Cash Flows

Financial Statement Analysis

Sustainability

Filters