Exam 3: Cost Behavior, Cost Forecasting, and Segmented Income Statements

__________________________ is critically important in determining cost behavior and is by far the most widely used method in practice.

Which of the following is true about managerial judgment?

Zinc Company constructed the following formula for monthly utility cost. Total utility cost = $1,000 + ($5 × Number of labor hours) Assume that 500 labor hours are budgeted for the month of April.Calculate the total utility cost for the month of April.

Select the appropriate type of cost for each of the definitions listed below. -total cost = total fixed cost + total variable cost

The relevant range

Cost behavior analysis focuses on

PristinDay Company produces handheld calculators.The company controller wanted to calculate the fixed and variable costs associated with the maintenance cost incurred by the factory.Data for the past four months were collected as follows: Coefficients shown by a regression program are as follows: -Using the results of regression, calculate the fixed cost of maintenance.

The following cost formula was developed using monthly data for a retail clothing store: Total cost = $50,000 + ($250 × number of customers) The number $250:

Match the type of income statement to the costs it includes. -Variable overhead for units sold

If the number of units produced in a period is larger than the number of units sold in a period, absorption costing income will be higher than variable costing income.

The following four months of data were collected on utility cost and the number of labor hours in a factory. - Using the high-low method, compute the fixed cost of electricity.

Discretionary fixed costs often involve a long-term contract.

Variable costing treats fixed factory overhead as a ______________.

The following cost formula was developed using the monthly data for an accounting firm. Total cost = $87,100 + ($210 × number of tax returns) The term "number of tax returns"

Select the appropriate item for each of the definitions listed below. -it corresponds to the variable rate

Blacken Company manufactures motorcycles.The company's management accountant wants to calculate the fixed and variable costs associated with utility cost incurred by the factory.Data for the past five months were collected. - Using a regression program, the forecasted utility cost at 2,600 machine hours (rounded to the nearest dollar) is

Match the type of income statement to the costs it includes. -Only fixed factory overhead for units sold

The following information pertains to Stark Corporation: - What is the value of ending inventory using the absorption costing method?

A driver is a factor that causes or leads to a change in a cost.

Computing unit fixed costs may result in misleading information.