Question 1

Board Games, Inc. makes board games. The following data pertains to the last six months:   Based on this data, what is the value of "f" in the equation y = vx + f?

Accepted Answer

A) $36,860 
B) $156,500 
C) $120,000 
D) $50,000 
A) $36,860 
B) $156,500 
C) $120,000 
D) $50,000

Question 2

Steeplechase Building Specialties manufactures metal stud to accommodate commercial framing contractors in the United States. The managerial accountant reported to the operations manager that there is an order to manufacture 2500 bundles of metal stud during the month. The managerial accountant reported the following information:   Determine the cost equation for the managerial accountant and predict the operating costs at a volume of 2500 bundles of metal stud at Steeplechase Building Specialties.

Accepted Answer

A) $2500 
B) $220 
C) $380 
D) $550,160 
A) $2500 
B) $220 
C) $380 
D) $550,160

Question 3

If production increases by 30%, how will total variable costs likely react?

Accepted Answer

A) Increase by 15% 
B) Decrease by 30% 
C) Increase by 30% 
D) Remain the same 
A) Increase by 15% 
B) Decrease by 30% 
C) Increase by 30% 
D) Remain the same

Question 4

Management has little or no control over

Accepted Answer

A) discretionary fixed costs. 
B) committed fixed costs. 
C) all fixed costs. 
D) all of the above. 
A) discretionary fixed costs. 
B) committed fixed costs. 
C) all fixed costs. 
D) all of the above.

Question 5

If a regression analysis shows an R factor of 0.15, it is safe to assume

Accepted Answer

A) a strong positive relationship between cost and volume. 
B) a strong negative relationship between cost and volume. 
C) a perfect positive relationship between cost and volume. 
D) a very weak relationship between cost and volume. 
A) a strong positive relationship between cost and volume. 
B) a strong negative relationship between cost and volume. 
C) a perfect positive relationship between cost and volume. 
D) a very weak relationship between cost and volume.

Question 6

Valle Crucis Corporation 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 the cost equation based upon the results of the regression analysis?

Accepted Answer

A) y = $072x 
B) y = $0.72x + $2,945.95 
C) y = $2,945.95x + $0.72 
D) y = $2,945.95 + $0.72 
A) y = $072x 
B) y = $0.72x + $2,945.95 
C) y = $2,945.95x + $0.72 
D) y = $2,945.95 + $0.72

Question 7

The managerial accountant at Organic Beverage Factory used spreadsheet software to run a regression analysis scenario and compile the following monthly cost data:   Which of the following is the correct estimated cost at a level of 8,000 units, based on the results of the regression analysis compiled by the managerial accountant?

Accepted Answer

A) $4,286,652 
B) $4,291,869 
C) $225,680 
D) $4,512,332 
A) $4,286,652 
B) $4,291,869 
C) $225,680 
D) $4,512,332

Question 8

It costs Homer's Manufacturing $0.65 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 $16,000 a month rent for his factory and store, and also pays $81,000 a month to his staff in addition to the commissions. Homer sold 69,500 baseballs in June. If Homer prepares a traditional income statement for the month of June, what would be his gross profit?

Accepted Answer

A) $323,175 
B) $232,825 
C) $278,000 
D) $45,175 
A) $323,175 
B) $232,825 
C) $278,000 
D) $45,175

Question 9

Using account analysis, what type of cost is the rental of a space at $6,000 per month?

Accepted Answer

A) Mixed 
B) Fixed 
C) Step 
D) Variable 
A) Mixed 
B) Fixed 
C) Step 
D) Variable

Question 10

In the equation y = vx + f, the x represents the fixed costs.

Accepted Answer

A) True 
 B)False

Question 11

Fixed costs that are the result of previous management decisions that current managers have no control over in the short run are called ________ fixed costs.

Accepted Answer

A) discretionary 
B) committed 
C) standard 
D) past 
A) discretionary 
B) committed 
C) standard 
D) past

Question 12

Johnson Trucking Company wants to determine a fuel surcharge to add to its customers' bills based on the number of miles driven to each area. It wants to separate the fixed and variable portion of the truck's operating costs so it has a better idea of how distance affects these costs. Johnson Trucking Company has the following data available.   The variable cost per mile using the high-low method is

Accepted Answer

A) $1.32 
B) $0.86 
C) $1.41 
D) $1.57 
A) $1.32 
B) $0.86 
C) $1.41 
D) $1.57

Question 13

At Dwight Incorporated, total fixed and variable costs are $410,000 at a production level of 120,000 units. The company has total fixed costs of $245,000. The fixed cost per unit at a production level of 200,000 units is

Accepted Answer

A) $3.42 
B) $2.04 
C) $1.67 
D) $1.23 
A) $3.42 
B) $2.04 
C) $1.67 
D) $1.23

Question 14

Johnson Trucking Company wants to determine a fuel surcharge to add to its customers' bills based on the number of miles driven to each area. It wants to separate the fixed and variable portion of the truck's operating costs so it has a better idea of how distance affects these costs. Johnson Trucking Company has the following data available.   Using the high-low method, the fixed costs in a month are (Round any intermediary calculations to the nearest cent.)

Accepted Answer

A) $5000 
B) $23,750 
C) $47,000 
D) $2250 
A) $5000 
B) $23,750 
C) $47,000 
D) $2250

Question 15

A basic tenet of variable costing is that fixed manufacturing overhead costs be currently expensed. What is the rationale behind this?

Accepted Answer

A) Fixed manufacturing overhead costs are generally immaterial in amount. 
B) Fixed manufacturing overhead costs occur regardless of level of production. 
C) Allocation of fixed manufacturing costs are arbitrary at best. 
D) Fixed manufacturing costs change as production changes. 
A) Fixed manufacturing overhead costs are generally immaterial in amount. 
B) Fixed manufacturing overhead costs occur regardless of level of production. 
C) Allocation of fixed manufacturing costs are arbitrary at best. 
D) Fixed manufacturing costs change as production changes.

Question 16

Using account analysis, what type of cost is the monthly cost of a storage locker used for holding old records?

Accepted Answer

A) Fixed 
B) Mixed 
C) Variable 
D) Step 
A) Fixed 
B) Mixed 
C) Variable 
D) Step

Question 17

The managerial accountant at Organic Beverage Factory used spreadsheet software to run a regression analysis scenario and compile the following monthly cost data:   Based on the results of the regression analysis compiled by the managerial accountant, what does the R-square indicate?

Accepted Answer

A) Management should use the cost equation with caution. 
B) Management can always rely upon cost equations prepared using linear regression analysis. 
C) Management can rely on the cost equation because the R-square is above 50% 
D) Management ignores the R-square in regression analysis. 
A) Management should use the cost equation with caution. 
B) Management can always rely upon cost equations prepared using linear regression analysis. 
C) Management can rely on the cost equation because the R-square is above 50% 
D) Management ignores the R-square in regression analysis.

Question 18

McCartney Services has a customer Web site to take orders, answer customer questions, and address customer complaints. The costs associated with this customer Web site over the past six months are listed below:
   Management at McCartney Services believes that the customer Web site costs are a mixed cost and would like to use the high-low method to estimate their future costs using the number of Web site hits in any given month as the cost driver.
Required:
1. Using the high-low method, estimate the variable cost per Web site hit and the monthly fixed costs associated with the customer Web site.
2. Use the results you computed in Requirement 1 to write the cost equation to estimate the customer Web site expenses for McCartney Services.
3. If McCartney Services expects 9,500 Web site hits for July, what are their anticipated customer Web site costs for July?

Accepted Answer

The answer of McCartney Services has a customer Web site...

Question 19

Outliers are abnormal data points.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following represents the total mixed cost equation?

Accepted Answer

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

Board Games, Inc. makes board games. The following data pertains to the last six months: Based on this data, what is the value of "f" in the equation y = vx + f?

If production increases by 30%, how will total variable costs likely react?

Management has little or no control over

If a regression analysis shows an R factor of 0.15, it is safe to assume

Using account analysis, what type of cost is the rental of a space at $6,000 per month?

In the equation y = vx + f, the x represents the fixed costs.

Fixed costs that are the result of previous management decisions that current managers have no control over in the short run are called ________ fixed costs.

At Dwight Incorporated, total fixed and variable costs are $410,000 at a production level of 120,000 units. The company has total fixed costs of $245,000. The fixed cost per unit at a production level of 200,000 units is

A basic tenet of variable costing is that fixed manufacturing overhead costs be currently expensed. What is the rationale behind this?

Using account analysis, what type of cost is the monthly cost of a storage locker used for holding old records?

The managerial accountant at Organic Beverage Factory used spreadsheet software to run a regression analysis scenario and compile the following monthly cost data: Based on the results of the regression analysis compiled by the managerial accountant, what does the R-square indicate?

Outliers are abnormal data points.

Which of the following represents the total mixed cost equation?

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 Evalulation

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

Board Games, Inc. makes board games. The following data pertains to the last six months: Based on this data, what is the value of "f" in the equation y = vx + f?

If production increases by 30%, how will total variable costs likely react?

Management has little or no control over

If a regression analysis shows an R factor of 0.15, it is safe to assume

Using account analysis, what type of cost is the rental of a space at $6,000 per month?

In the equation y = vx + f, the x represents the fixed costs.

Fixed costs that are the result of previous management decisions that current managers have no control over in the short run are called ________ fixed costs.

At Dwight Incorporated, total fixed and variable costs are $410,000 at a production level of 120,000 units. The company has total fixed costs of $245,000. The fixed cost per unit at a production level of 200,000 units is

A basic tenet of variable costing is that fixed manufacturing overhead costs be currently expensed. What is the rationale behind this?

Using account analysis, what type of cost is the monthly cost of a storage locker used for holding old records?

The managerial accountant at Organic Beverage Factory used spreadsheet software to run a regression analysis scenario and compile the following monthly cost data: Based on the results of the regression analysis compiled by the managerial accountant, what does the R-square indicate?

Outliers are abnormal data points.

Which of the following represents the total mixed cost equation?

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 Evalulation

Standard Costs and Variances

Capital Investment Decisions and the Time Value of Money

Statement of Cash Flows

Financial Statement Analysis

Sustainability

Filters