Question 1

The cost function y = 1,000 + 5X

Accepted Answer

A) has a slope coefficient of 1,000. 
B) is curvilinear because of the 5X. 
C) is a straight line. 
D) represents a fixed cost. 
E) is missing the slope coefficient. 
A) has a slope coefficient of 1,000. 
B) is curvilinear because of the 5X. 
C) is a straight line. 
D) represents a fixed cost. 
E) is missing the slope coefficient.

Question 2

Use the information below to answer the following question(s).At the high point of the relevant range, labour hours at Bradco Restoration were 10,000 and wages were $22,500.At the low point of the relevant range, labour hours were 7,500 and wages were $17,500.
-What is the high-low estimate of the labour costs at Bradco Restoration when 8,000 hours are used?

Accepted Answer

A) $21,500 
B) $18,500 
C) $17,750 
D) $17,250 
E) $17,125 
A) $21,500 
B) $18,500 
C) $17,750 
D) $17,250 
E) $17,125

Question 3

Stow-a-way Luggage Ltd.manufactures luggage for the traveler concerned about excessive airline luggage fees.They have two designs of carry-on luggage.The "Exec" is targeted to business travelers and the "Companion" for those on a holiday.The company used simple regression to budget indirect costs of $823,400 based on the following equation: y = $542,400 + $5.62X, where X is 50,000 direct labour hours for a budgeted production of 250,000 units.At the end of the year the company's controller evaluated the actual costs for producing 220,000 units.Using simple regression that actual indirect cost of $810,825; represented by the following equation y = $535,400 + $5.75X for the 47,900 actual direct labour hours.Required:
a.Determine the rate, efficiency/production-volume variances for the indirect costs.
b.What statistical measure of serial correlation could the controller use to determine if the independence of the residuals is within an acceptable range?

Accepted Answer

a. @#IMG-DLM& * standard hours allowed f

Question 4

A factor where the change in the factor causes a change in the speed with which an activity is undertaken is referred to as

Accepted Answer

A) a bottleneck. 
B) value added time. 
C) opportunity cost. 
D) cycle time. 
E) a time driver. 
A) a bottleneck. 
B) value added time. 
C) opportunity cost. 
D) cycle time. 
E) a time driver.

Question 5

Use the information below to answer the following question(s).The Skip Corporation has assembled the following data pertaining to certain costs which cannot be easily identified as either fixed or variable.Skip Corporation has heard about a method of measuring cost functions called the high-low method and has decided to use it in this situation.  
-The total cost at an operating level of 2,850 hours would be

Accepted Answer

A) $19,210. 
B) $11,763. 
C) $14,697. 
D) $11,212. 
E) $9,210. 
A) $19,210. 
B) $11,763. 
C) $14,697. 
D) $11,212. 
E) $9,210.

Question 6

Answer the following question(s)using the information below:
The tool crib at a large manufacturing company is responsible for providing tools to the factory workers on demand.The tool crib has a variable demand.Historically, its demand has ranged from 150 to 250 small tools per day with an average of 200.Diane, the tool crib attendant, works eight hours a day, five days a week.Each order is for one small tool and each small tool takes Diane 2 minutes to retrieve from the bins.
-What is the tool crib cycle time for an order?

Accepted Answer

A) 2 minutes per tool 
B) 3 minutes per tool 
C) 5 minutes per tool 
D) 7 minutes per tool 
E) 4 minutes per tool 
A) 2 minutes per tool 
B) 3 minutes per tool 
C) 5 minutes per tool 
D) 7 minutes per tool 
E) 4 minutes per tool

Question 7

The demand for Ballard's Glass Company's products varies, ranging from 10 to 20 windows a day with an average of 15.John Ballard is the only worker and he works a maximum of eight hours a day, five days a week.Each order is one window, and each window takes 26 minutes to install.The company plans to add doors to its product line and anticipates that they will sell an average of 5 doors per day.Each door takes 12 minutes to install.Ballard is concerned with the increased waiting time if it adds doors.To offset this concern it can hire a part-time employee.This will decrease window time to 20 minutes and door time to 10 minutes; increase the costs of windows from $10 to $12 and doors from $6 to $7.50.Since Ballard is giving customers faster service it will increase its prices from $17 to $20 for windows and from $10 to $12 for doors.What is the expected daily revenue with and without doors, respectively, assuming average sales units are used and the company hires a part-time employee if doors are sold?

Accepted Answer

A) $230 and $170 
B) $260 and $200 
C) $360 and $255 
D) $315 and $300 
E) $400 and $340 
A) $230 and $170 
B) $260 and $200 
C) $360 and $255 
D) $315 and $300 
E) $400 and $340

Question 8

A cost analyst collected the following information for the Machining Department:
   Required:
a.Determine the estimating cost function with machine-hours as the cost driver using the high-low method.
b.If December's estimated machine-hours total 8,400, what is the estimated cost of the Machining Department?

Accepted Answer

a.Slope coefficient = ($66,000

Question 9

Goodness-of-fit measures how well the predicted values in a cost estimating equation

Accepted Answer

A) match the cost driver. 
B) match the actual cost observations. 
C) fit the coefficient of determination. 
D) rely on the independent variable. 
E) rely on the dependent variable. 
A) match the cost driver. 
B) match the actual cost observations. 
C) fit the coefficient of determination. 
D) rely on the independent variable. 
E) rely on the dependent variable.

Question 10

Plotting learning curve observations is helpful in selecting the appropriate learning curve model.

Accepted Answer

A) True 
 B)False

Question 11

Nidek manufactures sport swear.Classify each of the following quality costs as prevention, appraisal, internal failure or external failure.
A)Internal failure
B)Prevention
C)Appraisal
D)External failure
-Product liability

Accepted Answer

The answer of Nidek manufactures sport swear.Classify each of the...

Question 12

A linear cost function is a function in which the graph of total costs versus a single cost driver forms a straight line, within the relevant range.

Accepted Answer

A) True 
 B)False

Question 13

Discuss how a manufacturer of personal computers such as Dell Computer can benefit from the introduction of a quality improvement program.

Accepted Answer

A quality improvement program for Dell w

Question 14

Use the information below to answer the following question(s).Raymaster is a small computer software company which uses the account analysis method and has hired you to perform some management advisory services.The company sold 2,500 high quality payroll programs last year.  
-What is the predicted indirect manufacturing labour cost if 160 machine-hours are budgeted and 170 are actually worked, assuming the estimated cost function is y = $81.04 + 5.32x?

Accepted Answer

A) $985.44 
B) $932.24 
C) $904.40 
D) $851.20 
E) $81.04 
A) $985.44 
B) $932.24 
C) $904.40 
D) $851.20 
E) $81.04

Question 15

Answer the following question(s)using the information below.The Taranto Company uses the high-low method to estimate it's cost function.The information for the current year is provided below:
  
-What is the estimate of the total cost when 1,100 machine-hours are used?

Accepted Answer

A) $125,000 
B) $135,000 
C) $150,000 
D) $200,000 
E) $136,000 
A) $125,000 
B) $135,000 
C) $150,000 
D) $200,000 
E) $136,000

Question 16

What is the time needed to produce the last unit when production doubles from 100 units to the 200 unit level, given that the incremental unit time learning model has a 60% learning curve, and the corresponding time at the 100 unit level of production is 4.0 minutes?

Accepted Answer

A) 8.0 minutes 
B) 6.4 minutes 
C) 4.0 minutes 
D) 2.4 minutes 
E) 1.6 minutes 
A) 8.0 minutes 
B) 6.4 minutes 
C) 4.0 minutes 
D) 2.4 minutes 
E) 1.6 minutes

Question 17

The managers of the production department have decided to use the production levels of 2018 and 2019 as examples of the highest and lowest years of operating levels.During 2018 the department used 280,000 litres of chemicals and during 2019 it used 240,000 litres.The department's costs for 2018 were $460,000, but only $400,000 in 2019.Required:
Using the high-low method determine the cost estimating equation for the department if litres of direct material are used as the cost driver?

Accepted Answer

Slope (variable cost)= ($460,0

Question 18

Prevention costs include all of the following EXCEPT

Accepted Answer

A) quality training. 
B) design engineering. 
C) product testing. 
D) supplier evaluations. 
E) testing of new materials. 
A) quality training. 
B) design engineering. 
C) product testing. 
D) supplier evaluations. 
E) testing of new materials.

Question 19

The Door Company manufactures doors.Classify each of the following quality costs as prevention costs, appraisal costs, internal failure costs, or external failure costs.
A)Appraisal
B)Internal failure
C)Prevention
D)External failure
-Plant utilities in the inspection area

Accepted Answer

The answer of The Door Company manufactures doors.Classify each of...

Question 20

Which of the following statements regarding a linear cost function is TRUE?

Accepted Answer

A) When there are only fixed costs, total material costs increase as the number of units produced increases. 
B) The slope coefficient of a mixed cost line intersects the vertical axis at zero. 
C) The relationship between the cost driver and the fixed cost is represented by the cost-benefit relationship. 
D) It is easier to identify a single measure of benefit in a more heterogeneous cost pool. 
E) A linear cost function for manufacturing overhead can be graphed when their is a cause-and-effect relationship between the level of activity and the costs related to that level of activity. 
A) When there are only fixed costs, total material costs increase as the number of units produced increases. 
B) The slope coefficient of a mixed cost line intersects the vertical axis at zero. 
C) The relationship between the cost driver and the fixed cost is represented by the cost-benefit relationship. 
D) It is easier to identify a single measure of benefit in a more heterogeneous cost pool. 
E) A linear cost function for manufacturing overhead can be graphed when their is a cause-and-effect relationship between the level of activity and the costs related to that level of activity.

The cost function y = 1,000 + 5X

A factor where the change in the factor causes a change in the speed with which an activity is undertaken is referred to as

Goodness-of-fit measures how well the predicted values in a cost estimating equation

Plotting learning curve observations is helpful in selecting the appropriate learning curve model.

Nidek manufactures sport swear.Classify each of the following quality costs as prevention, appraisal, internal failure or external failure. A)Internal failure B)Prevention C)Appraisal D)External failure -Product liability

A linear cost function is a function in which the graph of total costs versus a single cost driver forms a straight line, within the relevant range.

Discuss how a manufacturer of personal computers such as Dell Computer can benefit from the introduction of a quality improvement program.

Answer the following question(s)using the information below.The Taranto Company uses the high-low method to estimate it's cost function.The information for the current year is provided below: -What is the estimate of the total cost when 1,100 machine-hours are used?

What is the time needed to produce the last unit when production doubles from 100 units to the 200 unit level, given that the incremental unit time learning model has a 60% learning curve, and the corresponding time at the 100 unit level of production is 4.0 minutes?

Prevention costs include all of the following EXCEPT

The Door Company manufactures doors.Classify each of the following quality costs as prevention costs, appraisal costs, internal failure costs, or external failure costs. A)Appraisal B)Internal failure C)Prevention D)External failure -Plant utilities in the inspection area

Which of the following statements regarding a linear cost function is TRUE?

The Accountants Vital Role in Decision Making

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Management

Master Budget and Responsibility Accounting

Flexible Budgets, Variances, and Management Control: I

Flexible Budgets, Variances, and Management Control: II

Income Effects of Denominator Level on Inventory Valuation

Decision Making and Relevant Information

Pricing Decisions, Product Profitability Decisions, and Cost Management

Strategy, Balanced Scorecard, and Profitability Analysis

Period Cost Allocation

Cost Allocation: Joint Products and Byproducts

Revenue and Customer Profitability Analysis

Process Costing

Spoilage, Rework, and Scrap

Inventory Cost Management Strategies

Capital Budgeting: Methods of Investment Analysis

Transfer Pricing and Multinational Management Control Systems

Multinational Performance Measurement and Compensation

Filters

Exam 10: Analysis of Cost Behaviour

The cost function y = 1,000 + 5X

A factor where the change in the factor causes a change in the speed with which an activity is undertaken is referred to as

Goodness-of-fit measures how well the predicted values in a cost estimating equation

Plotting learning curve observations is helpful in selecting the appropriate learning curve model.

Nidek manufactures sport swear.Classify each of the following quality costs as prevention, appraisal, internal failure or external failure. A)Internal failure B)Prevention C)Appraisal D)External failure -Product liability

A linear cost function is a function in which the graph of total costs versus a single cost driver forms a straight line, within the relevant range.

Discuss how a manufacturer of personal computers such as Dell Computer can benefit from the introduction of a quality improvement program.

Answer the following question(s)using the information below.The Taranto Company uses the high-low method to estimate it's cost function.The information for the current year is provided below: -What is the estimate of the total cost when 1,100 machine-hours are used?

What is the time needed to produce the last unit when production doubles from 100 units to the 200 unit level, given that the incremental unit time learning model has a 60% learning curve, and the corresponding time at the 100 unit level of production is 4.0 minutes?

Prevention costs include all of the following EXCEPT

The Door Company manufactures doors.Classify each of the following quality costs as prevention costs, appraisal costs, internal failure costs, or external failure costs. A)Appraisal B)Internal failure C)Prevention D)External failure -Plant utilities in the inspection area

Which of the following statements regarding a linear cost function is TRUE?

The Accountants Vital Role in Decision Making

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Management

Master Budget and Responsibility Accounting

Flexible Budgets, Variances, and Management Control: I

Flexible Budgets, Variances, and Management Control: II

Income Effects of Denominator Level on Inventory Valuation

Decision Making and Relevant Information

Pricing Decisions, Product Profitability Decisions, and Cost Management

Strategy, Balanced Scorecard, and Profitability Analysis

Period Cost Allocation

Cost Allocation: Joint Products and Byproducts

Revenue and Customer Profitability Analysis

Process Costing

Spoilage, Rework, and Scrap

Inventory Cost Management Strategies

Capital Budgeting: Methods of Investment Analysis

Transfer Pricing and Multinational Management Control Systems

Multinational Performance Measurement and Compensation

Filters