Exam 6: Cost Behavior

When predicting costs at other volumes using a cost equation derived from either the high-low method or regression analysis,managers should consider

Green Corporation has total sales revenues of $400,000.If its total fixed costs are $70,000 and its total variable costs are $150,000,the contribution margin is

The managerial accountant at Flat Screen Manufacturing reported that the organization contains an automated production line to manufacture and produce its products for consumers to enjoy in the marketplace.The managerial accountant reported that the company uses the high-low method to estimate the costs in the new budget.The managerial accountant reported the following information: a.Compute the slope of the mixed cost,or the variable cost per unit of activity. b.Compute the vertical intercept,or the fixed cost component of the mixed cost. c.What is the mixed cost equation?

Using account analysis,what type of cost is the local phone service which charges a flat fee for unlimited local calls?

If a company's overhead cost equation is y = $8.80x + $120,020.The "x" is

When graphing total fixed costs,the fixed cost per unit is the slope of the fixed cost line.

The line determined by regression analysis is sometimes referred to as the "line of worst fit."

The cost equation determined by regression analysis is usually more accurate than the line determined by the high-low method.

Total fixed costs do not change in response to changes in the volume of production.

If production increases by 25%,how will total fixed costs likely react?

Which of the following is a characteristic of a variable cost?

Answer the following questions: a.What is a cost equation? b.If a company has fixed costs of $1,000 and variable costs of $4 per unit,what is their cost equation? c.What would a company use a cost equation for?

When using the high-low method,the "low" point should be chosen as the data point with the lowest volume (not the lowest cost).

Pablo was reviewing the water bill for his carwash business and determined that the highest bill,$5,000,occurred in July when 2,200 cars were washed and the lowest bill,$3,200,occurred in February when 1,400 cars were washed.What was the fixed portion of the water bill?

When using the high-low method,the variable cost per unit can be found as

The representation for fixed cost per unit of activity is

Which of the following does not appear on an income statement prepared using variable costing?

Relevant range is the range of activity (volume)over which total fixed costs and variable costs per unit can be assumed to remain the same.

When using the high-low method,the slope of the mixed cost line is fixed cost per unit.

The Akron Slugger Company produces various types of wooden baseball bats.It has calculated the average cost per unit of a production level of 7,500 bats to be $10.00.Given this information,what would be the total cost of producing 7,500 baseball bats?