Exam 3: Cost Behaviour, Cost Drivers and Cost Estimation

Total costs are $140 000 when 10 000 units are made.Of this amount,variable costs are $4 per unit.What are the total costs when 8000 units are produced?

If very short time periods such as a week are used for a regression study,rather than longer periods such as a month:

Which of the following are important in estimating the cost of machine maintenance?

A manufacturer plans to increase production within the relevant range of activity.What behaviour can the company expect for each of the following? Fixed cost per unit Variable cost per unit

Economic plausibility is one of the criteria used to evaluate a particular regression line.

The variable costs per unit are $4 when a company makes 10 000 units.What are the per unit variable costs when 8000 units are produced?

In which approach to cost estimation,is least squares used?

Eldervale Winery is a producer of premium wine.Which of the following is an example of a unit level cost?

Assume the costs of a service department are driven by the number of service orders and the equation for calculating the costs of a service department is y = $5 000 + $3x.The cost of the department if there were 6 000 orders would be $25 000.

In activity-based costing analysis,package design is classified as:

Consider the following equation: Total cost = fixed costs + (cost driver rate × cost driver quantity) If a cost can be estimated using this equation,it is probably a:

Within the relevant range,a curvilinear cost function can be graphed as a:

A scatter diagram is most useful in providing insight into whether there is a relationship between a cost and a level of activity.

Technical Engineering presently leases a copying machine on a monthly basis.The lease agreement requires a fixed fee each month in addition to a charge per copy.Technical Engineering made 2400 copies and paid a total of $162 in rent in September and in October they paid $195 for 3500 copies.Determine Technical's monthly fixed fee.

Yang Manufacturing makes a product called Yin.The relevant range of operations is between 2500 units and 10 000 units of Yin per month.Per unit costs at two activity levels are as follows: 5000 units at $17.00 per unit;7500 units at $13.00 per unit.Determine the cost formula that expresses the behaviour of Yang's total costs:

An example of a discretionary cost for a firm that manufactures furniture is:

In the regression formula Y = a + bX,b is:

In activity-based costing analysis,set-up costs are classified as:

The following is an extract of a cost report for Big Whale Car Wash for the six months from June to November.Management considers the activities in these six months as within the relevant range for the purpose of cost estimation.The car washing labour cost is a:

Which of the following describes a cost-estimation method that involves a careful examination of the ledger accounts?