Question 1

Using the high-low method, the calculation of the cost line uses the highest and lowest activity period.

Accepted Answer

A) True 
 B)False

Question 2

Product cost includes all costs of the company.

Accepted Answer

A) True 
 B)False

Question 3

Select the appropriate type of cost for each of the definitions listed below.
-remains constant on a per-unit basis within the relevant range

Accepted Answer

A) variable 
B) fixed 
C) mixed 
D) step 
A) variable 
B) fixed 
C) mixed 
D) step

Question 4

The _________________________ is a way to see the cost relationship by plotting the data points on a graph.

Accepted Answer

The answer of The _________________________ is a way to see...

Question 5

The slope of the line in a mixed cost graph represents the _____ per unit of activity driver.

Accepted Answer

A)  step cost 
B)  total cost 
C)  variable cost 
D)  total fixed cost 
A)  step cost 
B)  total cost 
C)  variable cost 
D)  total fixed cost

Question 6

Select the appropriate cost behavior for the following costs incurred by an automobile manufacturer.
-factory supervisor's salary

Accepted Answer

A) variable 
B) fixed 
A) variable 
B) fixed

Question 7

______________________________ is a statistical way to find the best-fitting line through a set of data points.

Accepted Answer

The method of least

Question 8

Which of the following is an advantage of using the scatter-graph method over the high-low method to estimate costs?

Accepted Answer

A)  It is a statistical method to determine "best fit". 
B)  A cost analyst can review the data visually and eliminate outliers. 
C)  The quality of the cost formula relies on the objective judgment of the analysts. 
D)  The cost formula can be determined simply by looking at two points of data. 
A)  It is a statistical method to determine "best fit". 
B)  A cost analyst can review the data visually and eliminate outliers. 
C)  The quality of the cost formula relies on the objective judgment of the analysts. 
D)  The cost formula can be determined simply by looking at two points of data.

Question 9

The method of least squares was used to develop a cost equation to predict the cost of monthly equipment maintenance.The following computer output was received: ​
  What is the independent variable of the cost formula for equipment maintenance?

Accepted Answer

A)  number of machine hours 
B)  the variable rate 
C)  the fixed cost 
D)  the total cost 
A)  number of machine hours 
B)  the variable rate 
C)  the fixed cost 
D)  the total cost

Question 10

The following information pertains to Stark Corporation:  
 
- Absorption costing income would be ____ the variable costing income.

Accepted Answer

A)  $50,000 greater than 
B)  $70,000 greater than 
C)  $70,000 less than 
D)  $50,000 less than 
A)  $50,000 greater than 
B)  $70,000 greater than 
C)  $70,000 less than 
D)  $50,000 less than

Question 11

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

Accepted Answer

A)  $310,000 
B)  $250,000 
C)  $200,000 
D)  $390,000 
A)  $310,000 
B)  $250,000 
C)  $200,000 
D)  $390,000

Question 12

Select the appropriate type of cost for each of the definitions listed below.
-has a discontinuous cost function

Accepted Answer

A) variable 
B) fixed 
C) mixed 
D) step 
A) variable 
B) fixed 
C) mixed 
D) step

Question 13

Select the appropriate item for each of the definitions listed below.
-the range of output over which the assumed cost relationship is valid

Accepted Answer

A) relevant range 
B) cost behavior 
C) driver 
D) variable cost 
E) fixed cost 
A) relevant range 
B) cost behavior 
C) driver 
D) variable cost 
E) fixed cost

Question 14

Using a linear regression program, the term 'Intercept' refers to the variable cost.

Accepted Answer

A) True 
 B)False

Question 15

Matching
Select the appropriate cost behavior for each of the costs listed below.
-factory supervisor's salary

Accepted Answer

A) variable 
B) fixed 
A) variable 
B) fixed

Question 16

Generally Accepted Accounting Principles (GAAP) require the use of which accounting method for external reporting?

Accepted Answer

A)  absorption costing. 
B)  variable costing. 
C)  transfer price costing. 
D)  responsibility costing. 
E)  all of these are acceptable for GAAP. 
A)  absorption costing. 
B)  variable costing. 
C)  transfer price costing. 
D)  responsibility costing. 
E)  all of these are acceptable for GAAP.

Question 17

Which of the following is not true of the method of least squares?

Accepted Answer

A)  The method uses only variable cost to calculate the total cost. 
B)  The method uses only two points to develop the cost function. 
C)  The method involves minimization of the squared differences between actual observations and the line (cost function). 
D)  The method offers ways to assess the reliability of cost equations. 
A)  The method uses only variable cost to calculate the total cost. 
B)  The method uses only two points to develop the cost function. 
C)  The method involves minimization of the squared differences between actual observations and the line (cost function). 
D)  The method offers ways to assess the reliability of cost equations.

Question 18

Select the appropriate item for each of the definitions listed below.
-is a statistical method

Accepted Answer

A) high-low method 
B) scatter-graph method 
C) method of least squares 
A) high-low method 
B) scatter-graph method 
C) method of least squares

Question 19

Chrysntag Company incurred the following costs for the months of January and February. 
 
  Assume that output was 1,000 units in January and 3,500 units in February, utility cost is a mixed cost, and the fixed cost of utilities was $2,000.What was the variable rate per unit of output for utilities cost?

Accepted Answer

A)  $0.60 
B)  $0.40 
C)  $0.20 
D)  $0.30 
A)  $0.60 
B)  $0.40 
C)  $0.20 
D)  $0.30

Question 20

Loring Company had the following data for the month:  
  What is operating income under absorption costing?

Accepted Answer

A)  $3,540 
B)  $7,980 
C)  $11,340 
D)   $540 
E)  $3,740 
A)  $3,540 
B)  $7,980 
C)  $11,340 
D)   $540 
E)  $3,740

Using the high-low method, the calculation of the cost line uses the highest and lowest activity period.

Product cost includes all costs of the company.

Select the appropriate type of cost for each of the definitions listed below. -remains constant on a per-unit basis within the relevant range

The _________________________ is a way to see the cost relationship by plotting the data points on a graph.

The slope of the line in a mixed cost graph represents the _____ per unit of activity driver.

Select the appropriate cost behavior for the following costs incurred by an automobile manufacturer. -factory supervisor's salary

______________________________ is a statistical way to find the best-fitting line through a set of data points.

Which of the following is an advantage of using the scatter-graph method over the high-low method to estimate costs?

The method of least squares was used to develop a cost equation to predict the cost of monthly equipment maintenance.The following computer output was received: What is the independent variable of the cost formula for equipment maintenance?

The following information pertains to Stark Corporation: - Absorption costing income would be ____ the variable costing income.

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

Select the appropriate type of cost for each of the definitions listed below. -has a discontinuous cost function

Select the appropriate item for each of the definitions listed below. -the range of output over which the assumed cost relationship is valid

Using a linear regression program, the term 'Intercept' refers to the variable cost.

Matching Select the appropriate cost behavior for each of the costs listed below. -factory supervisor's salary

Generally Accepted Accounting Principles (GAAP) require the use of which accounting method for external reporting?

Which of the following is not true of the method of least squares?

Select the appropriate item for each of the definitions listed below. -is a statistical method

Chrysntag Company incurred the following costs for the months of January and February. Assume that output was 1,000 units in January and 3,500 units in February, utility cost is a mixed cost, and the fixed cost of utilities was $2,000.What was the variable rate per unit of output for utilities cost?

Loring Company had the following data for the month: What is operating income under absorption costing?

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Job-Order Costing and Normal Cost Overhead Application

Activity-Based Costing and Management

Process Costing

Cost-Volume-Profit Analysis

Tactical Decision-Making and Relevant Costing

Profit Planning and Flexible Budgets

Standard Costing and Variance Analysis

Performance Evaluation and Decentralization

Capital Investment Decisions

Emerging Topics in Managerial Accounting: Sustainability, Quality Cost, Lean Accounting, International Issues, Enterprise Risk Management, the Managerial Accountant in Forensicfraud Accounting

Statement of Cash Flows

Financial Statement Analysis

Filters

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

Using the high-low method, the calculation of the cost line uses the highest and lowest activity period.

Product cost includes all costs of the company.

Select the appropriate type of cost for each of the definitions listed below. -remains constant on a per-unit basis within the relevant range

The _________________________ is a way to see the cost relationship by plotting the data points on a graph.

The slope of the line in a mixed cost graph represents the _____ per unit of activity driver.

Select the appropriate cost behavior for the following costs incurred by an automobile manufacturer. -factory supervisor's salary

______________________________ is a statistical way to find the best-fitting line through a set of data points.

Which of the following is an advantage of using the scatter-graph method over the high-low method to estimate costs?

The method of least squares was used to develop a cost equation to predict the cost of monthly equipment maintenance.The following computer output was received: ​ What is the independent variable of the cost formula for equipment maintenance?

The following information pertains to Stark Corporation: - Absorption costing income would be ____ the variable costing income.

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

Select the appropriate type of cost for each of the definitions listed below. -has a discontinuous cost function

Select the appropriate item for each of the definitions listed below. -the range of output over which the assumed cost relationship is valid

Using a linear regression program, the term 'Intercept' refers to the variable cost.

Matching Select the appropriate cost behavior for each of the costs listed below. -factory supervisor's salary

Generally Accepted Accounting Principles (GAAP) require the use of which accounting method for external reporting?

Which of the following is not true of the method of least squares?

Select the appropriate item for each of the definitions listed below. -is a statistical method

Loring Company had the following data for the month: What is operating income under absorption costing?

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Job-Order Costing and Normal Cost Overhead Application

Activity-Based Costing and Management

Process Costing

Cost-Volume-Profit Analysis

Tactical Decision-Making and Relevant Costing

Profit Planning and Flexible Budgets

Standard Costing and Variance Analysis

Performance Evaluation and Decentralization

Capital Investment Decisions

Emerging Topics in Managerial Accounting: Sustainability, Quality Cost, Lean Accounting, International Issues, Enterprise Risk Management, the Managerial Accountant in Forensicfraud Accounting

Statement of Cash Flows

Financial Statement Analysis

Filters

The method of least squares was used to develop a cost equation to predict the cost of monthly equipment maintenance.The following computer output was received: What is the independent variable of the cost formula for equipment maintenance?