Question 1

Knowledge of cost and activity-level relationship is used by experienced .

Accepted Answer

The answer of Knowledge of cost and activity-level relationship is...

Question 2

Methods of estimating costs used by companies include the industrial engineering method, the account analysis method, and the instant decision method.

Accepted Answer

A) True 
 B)False

Question 3

is useful when the dependent variable is affected by more than one independent variable.

Accepted Answer

The answer of is useful when the dependent variable is...

Question 4

Figure 3-5
Longberry Corporation manufactures and sells party items. The following representative direct labor hours and production costs are provided for a four-month period:
  
-Refer to Figure 3-5. Predict a cost for 5,000 labor hours.

Accepted Answer

A)  $17,900 
B)  $17,700 
C)  $16,667 
D)  $30,400 
A)  $17,900 
B)  $17,700 
C)  $16,667 
D)  $30,400

Question 5

Figure 3-2
A company usually processes 20,000 orders at a total cost of $300,000. During the year, only 16,000 orders were processed.
-Refer to Figure 3-2. What is the cost of unused activity?

Accepted Answer

A)  $300,000 
B)  $240,000 
C)  $30 
D)  $60,000 
A)  $300,000 
B)  $240,000 
C)  $30 
D)  $60,000

Question 6

Advantages of the method of least squares over the high-low method include all of the following EXCEPT

Accepted Answer

A)  a statistical method is used to mathematically derive the cost function. 
B)  only two points are used to develop the cost function. 
C)  the squared differences between actual observations and the line (cost function) are minimized. 
D)  all the observations have an effect on the cost function. 
A)  a statistical method is used to mathematically derive the cost function. 
B)  only two points are used to develop the cost function. 
C)  the squared differences between actual observations and the line (cost function) are minimized. 
D)  all the observations have an effect on the cost function.

Question 7

An equipment lease that specifies a payment of $8,000 per month plus $7 per machine hour used is an example of a

Accepted Answer

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

Question 8

The cumulative average-time learning curve model states that the cumulative average time per unit increases by a constant percentage.

Accepted Answer

A) True 
 B)False

Question 9

What is the difference between a correlation equal to -1 and a correlation equal to +1?

Accepted Answer

A)  A correlation equal to -1 means two alternatives are moving in the same direction, whereas a correlation of +1 means they are moving in opposite directions. 
B)  A correlation equal to -1 means two alternatives are moving in the same direction, whereas a correlation of +1 means they are unrelated. 
C)  A correlation equal to -1 means two alternatives are moving in opposite directions, whereas a correlation of +1 means they are moving in the same direction. 
D)  A correlation equal to -1 means two alternatives are moving in opposite directions, whereas a correlation of +1 means they are unrelated. 
A)  A correlation equal to -1 means two alternatives are moving in the same direction, whereas a correlation of +1 means they are moving in opposite directions. 
B)  A correlation equal to -1 means two alternatives are moving in the same direction, whereas a correlation of +1 means they are unrelated. 
C)  A correlation equal to -1 means two alternatives are moving in opposite directions, whereas a correlation of +1 means they are moving in the same direction. 
D)  A correlation equal to -1 means two alternatives are moving in opposite directions, whereas a correlation of +1 means they are unrelated.

Question 10

Multiple regression can be useful to assess cost behavior when dependent variable is affected by only one independent variable.

Accepted Answer

A) True 
 B)False

Question 11

The efficient level of activity performance is called

Accepted Answer

A)  practical capacity. 
B)  activity capacity. 
C)  unused capacity. 
D)  acquired capacity. 
A)  practical capacity. 
B)  activity capacity. 
C)  unused capacity. 
D)  acquired capacity.

Question 12

What does a correlation coefficient near 0 mean?

Accepted Answer

A)  Two variables are moving in the opposite direction. 
B)  Two variables are moving in the same direction. 
C)  Two variables are unrelated. 
D)  One variable is a good predictor of the other. 
A)  Two variables are moving in the opposite direction. 
B)  Two variables are moving in the same direction. 
C)  Two variables are unrelated. 
D)  One variable is a good predictor of the other.

Question 13

Assume the following information:   What is the variable cost per unit?

Accepted Answer

A)  $15.00 
B)  $12.50 
C)  $13.75 
D)  $14.78 
A)  $15.00 
B)  $12.50 
C)  $13.75 
D)  $14.78

Question 14

Managerial judgement includes the possibility of mixed costs.

Accepted Answer

A) True 
 B)False

Question 15

Figure 3-2
A company usually processes 20,000 orders at a total cost of $300,000. During the year, only 16,000 orders were processed.
-Refer to Figure 3-2. What is the cost of resource usage?

Accepted Answer

A)  $300,000 
B)  $240,000 
C)  $30 
D)  $60,000 
A)  $300,000 
B)  $240,000 
C)  $30 
D)  $60,000

Question 16

Figure 3-6
The Stanford Company incurred the following maintenance cost during a five month period:
  
-Refer to Figure 3-6. Using a computer or calculator, compute the estimate of maintenance costs at 100 units of production using the method of least squares. This value would be

Accepted Answer

A)  $291. 
B)  $321. 
C)  $336. 
D)  $698. 
A)  $291. 
B)  $321. 
C)  $336. 
D)  $698.

Question 17

A cost that does not change as output changes is a variable cost, and one that changes is a fixed cost.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following is an example of a discretionary fixed expense?

Accepted Answer

A)  contract workers 
B)  property taxes on a factory building 
C)  depreciation on a factory building 
D)  insurance on a building 
A)  contract workers 
B)  property taxes on a factory building 
C)  depreciation on a factory building 
D)  insurance on a building

Question 19

If a company changes from skilled labor to robots, the previous data are of little value in predicting future costs.

Accepted Answer

A) True 
 B)False

Question 20

A number of cost behavior patterns do not follow a linear pattern, instead, they follow a nonlinear cost curve called the learning curve.

Accepted Answer

A) True 
 B)False

Knowledge of cost and activity-level relationship is used by experienced .

Methods of estimating costs used by companies include the industrial engineering method, the account analysis method, and the instant decision method.

is useful when the dependent variable is affected by more than one independent variable.

Figure 3-5 Longberry Corporation manufactures and sells party items. The following representative direct labor hours and production costs are provided for a four-month period: -Refer to Figure 3-5. Predict a cost for 5,000 labor hours.

Figure 3-2 A company usually processes 20,000 orders at a total cost of $300,000. During the year, only 16,000 orders were processed. -Refer to Figure 3-2. What is the cost of unused activity?

Advantages of the method of least squares over the high-low method include all of the following EXCEPT

An equipment lease that specifies a payment of $8,000 per month plus $7 per machine hour used is an example of a

The cumulative average-time learning curve model states that the cumulative average time per unit increases by a constant percentage.

What is the difference between a correlation equal to -1 and a correlation equal to +1?

Multiple regression can be useful to assess cost behavior when dependent variable is affected by only one independent variable.

The efficient level of activity performance is called

What does a correlation coefficient near 0 mean?

Assume the following information: What is the variable cost per unit?

Managerial judgement includes the possibility of mixed costs.

Figure 3-2 A company usually processes 20,000 orders at a total cost of $300,000. During the year, only 16,000 orders were processed. -Refer to Figure 3-2. What is the cost of resource usage?

Figure 3-6 The Stanford Company incurred the following maintenance cost during a five month period: -Refer to Figure 3-6. Using a computer or calculator, compute the estimate of maintenance costs at 100 units of production using the method of least squares. This value would be

A cost that does not change as output changes is a variable cost, and one that changes is a fixed cost.

Which of the following is an example of a discretionary fixed expense?

If a company changes from skilled labor to robots, the previous data are of little value in predicting future costs.

A number of cost behavior patterns do not follow a linear pattern, instead, they follow a nonlinear cost curve called the learning curve.

Introduction to Cost Management

Basic Cost Management Concepts

Activity-Based Costing

Product and Service Costing: Job-Order System

Process Costing

Allocating Costs of Support Departments and Joint Products

Budgeting for Planning and Control

Standard Costing: a Functional-Based Control Approach

Decentralization: Responsibility, Accounting, Performance Evaluation, and Transfer Pricing

Strategic Cost Management

Activity-Based Management

The Balanced Scorecard: Strategic-Based Control

Quality and Environmental Cost Management

Lean Accounting and Productivity Measurement

Cost-Volume-Profit Analysis

Activity Resource Usage Model and Tactical Decision Making

Pricing and Profitability Analysis

Capital Investment

Inventory Management: Economic Order Quantity, Jit, and the Theory of Constraints

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Exam 3: Cost Behavior

Knowledge of cost and activity-level relationship is used by experienced .

Methods of estimating costs used by companies include the industrial engineering method, the account analysis method, and the instant decision method.

is useful when the dependent variable is affected by more than one independent variable.

Figure 3-5 Longberry Corporation manufactures and sells party items. The following representative direct labor hours and production costs are provided for a four-month period: -Refer to Figure 3-5. Predict a cost for 5,000 labor hours.

Figure 3-2 A company usually processes 20,000 orders at a total cost of $300,000. During the year, only 16,000 orders were processed. -Refer to Figure 3-2. What is the cost of unused activity?

Advantages of the method of least squares over the high-low method include all of the following EXCEPT

An equipment lease that specifies a payment of $8,000 per month plus $7 per machine hour used is an example of a

The cumulative average-time learning curve model states that the cumulative average time per unit increases by a constant percentage.

What is the difference between a correlation equal to -1 and a correlation equal to +1?

Multiple regression can be useful to assess cost behavior when dependent variable is affected by only one independent variable.

The efficient level of activity performance is called

What does a correlation coefficient near 0 mean?

Assume the following information: What is the variable cost per unit?

Managerial judgement includes the possibility of mixed costs.

Figure 3-2 A company usually processes 20,000 orders at a total cost of $300,000. During the year, only 16,000 orders were processed. -Refer to Figure 3-2. What is the cost of resource usage?

Figure 3-6 The Stanford Company incurred the following maintenance cost during a five month period: -Refer to Figure 3-6. Using a computer or calculator, compute the estimate of maintenance costs at 100 units of production using the method of least squares. This value would be

A cost that does not change as output changes is a variable cost, and one that changes is a fixed cost.

Which of the following is an example of a discretionary fixed expense?

If a company changes from skilled labor to robots, the previous data are of little value in predicting future costs.

A number of cost behavior patterns do not follow a linear pattern, instead, they follow a nonlinear cost curve called the learning curve.

Introduction to Cost Management

Basic Cost Management Concepts

Activity-Based Costing

Product and Service Costing: Job-Order System

Process Costing

Allocating Costs of Support Departments and Joint Products

Budgeting for Planning and Control

Standard Costing: a Functional-Based Control Approach

Decentralization: Responsibility, Accounting, Performance Evaluation, and Transfer Pricing

Strategic Cost Management

Activity-Based Management

The Balanced Scorecard: Strategic-Based Control

Quality and Environmental Cost Management

Lean Accounting and Productivity Measurement

Cost-Volume-Profit Analysis

Activity Resource Usage Model and Tactical Decision Making

Pricing and Profitability Analysis

Capital Investment

Inventory Management: Economic Order Quantity, Jit, and the Theory of Constraints

Filters