Question 1

The HF Corporation manufactures and sells toy gyroscopes. The following data is related to sales and production of the toy gyroscopes for last year.  Using absorption costing, what is operating income for last year?

Accepted Answer

A)  $ 749,500
B)  $ 155,500
C)  $1,200,000
D)  $1,650,500E) A) and B)
F) A) and C)

Question 2

If there is little or no relationship between the cost and the volume, the data points on a scatter plot will appear almost as a straight line.

Accepted Answer

A) True 
 B)False

Question 3

Using account analysis, what type of cost is the monthly cost of a storage locker used for holding old records?

Accepted Answer

A)  Fixed
B)  Mixed
C)  Variable
D)  StepE) None of the above
F) A) and D)

Question 4

The cost of goods sold is a variable cost for merchandise company, but contains a mixture of variable and fixed production costs for manufacturers.

Accepted Answer

A) True 
 B)False

Question 5

Answer the following questions:
a.	What is a cost equation?
b.	If a company has fixed costs of $1,000 and variable costs of $4 per unit, what is their cost equation?
c.	What would a company use a cost equation for?

Accepted Answer

a. A cost equation takes the form of y =...

Question 6

The equation for total fixed costs is

Accepted Answer

A)  y = f.
B)  y = vx + f.
C)  y = vx - f.
D)  none of the above.E) All of the above
F) B) and D)

Question 7

The following is information about the units produced and the total manufacturing costs for Rose's Rug Company for the past six months.
  Rose's Rug Company uses the high-low method to estimate its costs.

Accepted Answer

part c.
...

Question 8

Sea Side Enterprises is trying to predict the cost associated with producing its anchors. At a production level of 5,000 anchors, Sea Side Enterprises' average cost per anchor is $52.00. What is the total cost of producing 5,000 anchors?

Accepted Answer

A)  $260,000.
B)  $5,052.
C)  $52.00.
D)  $96.E) A) and B)
F) B) and D)

Question 9

The X Variable 1 Coefficient in regression analysis yields the variable cost per unit of activity.

Accepted Answer

A) True 
 B)False

Question 10

Best Birdies produces ornate birdcages. The company's average cost per unit is $18.00 when it produces 2,200 birdcages. If $5,500 of the costs are fixed, and the plant manager uses the average cost per unit to predict total costs, his forecast for 3,000 birdcages will be

Accepted Answer

A)  $52,000.
B)  $39,600.
C)  $14,400.
D)  $54,000.E) All of the above
F) C) and D)

Question 11

Schrute Farm Sales buys portable generators for $450 and sells them for $720. He pays a sales commission of 5% of sales revenue to his sales staff. Mr. Schrute pays $2,000 a month rent for his store, and also pays $1,700 a month to his staff in addition to the commissions. Mr. Schrute sold 200 generators in June. If Mr. Schrute prepares a traditional income statement for the month of June, what
Would be his operating income?

Accepted Answer

A)  $ 43,100
B)  $ 54,00
C)  $ 64,900
D)  $144,000E) B) and D)
F) None of the above

Question 12

What term represents the variable cost per unit of activity in the equation: y = vx + f? (Assume x represents the volume of activity.)

Accepted Answer

A)  v
B)  f
C)  y
D)  vxE) A) and B)
F) A) and C)

Question 13

Stanley's Bicycles store buys bicycles on average for $600 and sells them on average for $750. He pays a sales commission of 15% of sales revenue to his sales staff. Stanley pays $1,400 a month rent for his store, and also pays $3,000 a month to his staff in addition to the commissions. Stanley sold 120 bicycles in June. If Stanley prepares a traditional income statement for the month of June, what would be his gross profit?

Accepted Answer

A)  $162,000
B)  $18,000
C)  $72,000
D)  $90,000E) A) and B)
F) A) and C)

Question 14

The line on a graph representing total fixed costs will be a horizontal line.

Accepted Answer

A) True 
 B)False

Question 15

Which type of costing system is the only acceptable costing system for external financial reporting?

Accepted Answer

A)  Prime costing
B)  Out-of-pocket costing
C)  Variable costing
D)  Absorption costingE) A) and D)
F) All of the above

Question 16

In the equation y = vx + f, the x represents the fixed costs.

Accepted Answer

A) True 
 B)False

Question 17

Managers often approximate curvilinear costs and step costs as fixed costs.

Accepted Answer

A) True 
 B)False

Question 18

Managers should consider which of the following when predicting costs at different volumes?

Accepted Answer

A)  The relevant range of the cost
B)  The type of cost behavior
C)  Both of the above should be considered.
D)  Neither of the above should be considered.E) C) and D)
F) B) and D)

Question 19

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

Accepted Answer

A) True 
 B)False

Question 20

The use of either absorption or variable costing will make little difference in companies

Accepted Answer

A)  using just-in-time inventory methods.
B)  with large inventories.
C)  with high fixed costs.
D)  with high variable costs.E) A) and B)
F) A) and D)

Exam 6: Cost Behavior

Using account analysis, what type of cost is the monthly cost of a storage locker used for holding old records?

Correct Answer
verified

The following is information about the units produced and the total manufacturing costs for Rose's Rug Company for the past six months. Rose's Rug Company uses the high-low method to estimate its costs.

Correct Answer
verified
part c.
...
View Answer

In the equation y = vx + f, the x represents the fixed costs.

Correct Answer
verified

What term represents the variable cost per unit of activity in the equation: y = vx + f? (Assume x represents the volume of activity.)

Correct Answer
verified

The cost of goods sold is a variable cost for merchandise company, but contains a mixture of variable and fixed production costs for manufacturers.

Correct Answer
verified

The line on a graph representing total fixed costs will be a horizontal line.

Correct Answer
verified

Which type of costing system is the only acceptable costing system for external financial reporting?

Correct Answer
verified

Best Birdies produces ornate birdcages. The company's average cost per unit is $18.00 when it produces 2,200 birdcages. If $5,500 of the costs are fixed, and the plant manager uses the average cost per unit to predict total costs, his forecast for 3,000 birdcages will be

Correct Answer
verified

Managers often approximate curvilinear costs and step costs as fixed costs.

Correct Answer
verified

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

Correct Answer
verified

The equation for total fixed costs is

Correct Answer
verified

Managers should consider which of the following when predicting costs at different volumes?

Correct Answer
verified

The use of either absorption or variable costing will make little difference in companies

Correct Answer
verified

Correct Answer
verified

If there is little or no relationship between the cost and the volume, the data points on a scatter plot will appear almost as a straight line.

Correct Answer
verified

The X Variable 1 Coefficient in regression analysis yields the variable cost per unit of activity.

Correct Answer
verified

The HF Corporation manufactures and sells toy gyroscopes. The following data is related to sales and production of the toy gyroscopes for last year. Using absorption costing, what is operating income for last year?

Correct Answer
verified

Correct Answer
verified

Answer the following questions: a. What is a cost equation? b. If a company has fixed costs of $1,000 and variable costs of $4 per unit, what is their cost equation? c. What would a company use a cost equation for?

Correct Answer
verified
a. A cost equation takes the form of y =...
View Answer

Sea Side Enterprises is trying to predict the cost associated with producing its anchors. At a production level of 5,000 anchors, Sea Side Enterprises' average cost per anchor is $52.00. What is the total cost of producing 5,000 anchors?

Correct Answer
verified

Exam 6: Cost Behavior

Using account analysis, what type of cost is the monthly cost of a storage locker used for holding old records?

Correct AnswerverifiedShow Answer

The following is information about the units produced and the total manufacturing costs for Rose's Rug Company for the past six months. Rose's Rug Company uses the high-low method to estimate its costs.

Correct Answerverified part c....View AnswerShow Answer

In the equation y = vx + f, the x represents the fixed costs.

Correct AnswerverifiedShow Answer

What term represents the variable cost per unit of activity in the equation: y = vx + f? (Assume x represents the volume of activity.)

Correct AnswerverifiedShow Answer

The cost of goods sold is a variable cost for merchandise company, but contains a mixture of variable and fixed production costs for manufacturers.

Correct AnswerverifiedShow Answer

The line on a graph representing total fixed costs will be a horizontal line.

Correct AnswerverifiedShow Answer

Which type of costing system is the only acceptable costing system for external financial reporting?

Correct AnswerverifiedShow Answer

Best Birdies produces ornate birdcages. The company's average cost per unit is $18.00 when it produces 2,200 birdcages. If $5,500 of the costs are fixed, and the plant manager uses the average cost per unit to predict total costs, his forecast for 3,000 birdcages will be

Correct AnswerverifiedShow Answer

Managers often approximate curvilinear costs and step costs as fixed costs.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The equation for total fixed costs is

Correct AnswerverifiedShow Answer

Managers should consider which of the following when predicting costs at different volumes?

Correct AnswerverifiedShow Answer

The use of either absorption or variable costing will make little difference in companies

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If there is little or no relationship between the cost and the volume, the data points on a scatter plot will appear almost as a straight line.

Correct AnswerverifiedShow Answer

The X Variable 1 Coefficient in regression analysis yields the variable cost per unit of activity.

Correct AnswerverifiedShow Answer

The HF Corporation manufactures and sells toy gyroscopes. The following data is related to sales and production of the toy gyroscopes for last year. Using absorption costing, what is operating income for last year?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Answer the following questions: a. What is a cost equation? b. If a company has fixed costs of $1,000 and variable costs of $4 per unit, what is their cost equation? c. What would a company use a cost equation for?

Correct Answerverifieda. A cost equation takes the form of y =...View AnswerShow Answer

Sea Side Enterprises is trying to predict the cost associated with producing its anchors. At a production level of 5,000 anchors, Sea Side Enterprises' average cost per anchor is $52.00. What is the total cost of producing 5,000 anchors?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified
part c.
...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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a. A cost equation takes the form of y =...
View Answer

Correct Answer
verified