Exam 6: Cost Behavior

Snowy Mountain Company has the following selected data for the past year: There were no units in beginning inventory. Required: a.Prepare an income statement for last year using absorption costing. b.Calculate the value of the ending inventory using absorption costing. c.Prepare an income statement for last year using variable costing. d.Calculate the value of the ending inventory using variable costing.

In the equation y = $7.20x + $250,250,

Regis Corporation wants to know how closely its current cost driver is correlated with its monthly operating costs.The managerial accountant runs a regression analysis using a statistical software program and produces the following data: Intercept Coefficient = 12,200,567 X Variable 1 Coefficient = 95.65 R-square = 0.8574 What is the Regis Corporation's monthly cost equation?

Traditional income statements provide managers with little cost behavior information.

Direct Call offers a calling plan that charges $5.00 per month plus $0.02 per minute of call time.Under this plan,what is your monthly cost if you talk for a total of 200 minutes?

On a contribution margin income statement,sales revenue less variable expenses equals

The variable cost per unit of activity increases as activity increases.

Which of the following would be considered a committed fixed cost?

The graph of total variable cost will be a horizontal line over all activity levels within the relevant range.

If inventory has declined,operating income will be higher under absorption costing than it is under variable costing.

The R-squared statistic determined by regression analysis is sometimes referred to as the "goodness-of-fit" statistic.

An R-square statistic of 0 indicates a perfect level of correlation between costs and the cost driver.

When graphing total variable costs,the cost line begins at the origin.

Outliers are data points that fall in the same general pattern as the other data points.

George Company has a relevant range of 150,000 units to 400,000 units.The company has total fixed costs of $525,000.Total fixed and variable costs are $612,500 at a production level of 175,000 units.The variable cost per unit at 300,000 units is

Total fixed costs for Taylor Incorporated are $240,000.Total costs,including both fixed and variable,are $500,000 if 125,000 units are produced.The variable cost per unit is

Net income reported under absorption costing will exceed net income reported under variable costing for a given period if

Fixed costs per unit decrease as production levels increase.

George Company has a relevant range of 150,000 units to 400,000 units.The company has total fixed costs of $525,000.Total fixed and variable costs are $612,500 at a production level of 175,000 units.The variable cost per unit at 300,000 units is

In the equation y = $7.20x + $790,"y" represents