Question : 78.Window Shine provides window cleaning service. Information concerning costs and : 1302726

 

 

78.Window Shine is provides window cleaning service. Information concerning costs and number of windows cleaned for three months during 2014 appear below:

 

MonthActivityCost

May18,000 windows              $84,000

July21,000 windows              94,500

September20,400 windows              94,800

 

Using the high-low method, what is the amount of total fixed costs?

A.$10,500

B.$3,000

C.$21,000

D.$78,857

 

79.Princeton offers a large range of undergraduate courses. The University is interested in determining the cost equation for the facilities cost as a function of student credit hours so that it can more accurately budget its facilities costs as enrollment grows. Information for the high and low cost semesters and volumes for last 5 years appears below:

 

Semester              Student Credit Hours              Facilities Cost

Spring 2014160,000$750,000

Fall 2017140,000$660,000

 

Using the high-low method, with student credit hours as the activity driver, what is the equation for facilities cost (FC) as a function of student credit hours?

A.FC = $4.50 / student credit hour

B.FC = $1.14 / student credit hour

C.FC = $30,000 + $4.50 / student credit hour

D.FC = $568,182 + $0.22 / student credit hour

 

80.A cost is $11,000 at 1,000 units, $12,000 at 2,000 units, and $13,000 at 3,000 units. Using the high-low method, how much is the fixed portion of these costs?

A.$1,000

B.$10,000

C.$20,000

D.The answer depends on the actual activity.

 

81.Which of the following methods provides the most accurate predictions of future costs?

A.Account analysis.

B.Scattergraphs.

C.High-low method.

D.Regression analysis.

 

82. Which of the following correctly describes fixed and variable cost behavior as total volume increases?

A.Unit fixed costs stay the same and unit variable costs increase.

B.Total fixed costs stay the same and total variable costs increase.

C.Unit fixed costs decrease and total variable costs decrease.

D.Unit fixed costs decrease and unit variable costs decrease.

 

83.Past relationships between cost and activity may not be a useful basis for estimating future costs

A.if most of a company’s costs are variable.

B.the company is able to accurately estimate its cost behavior.

C.if the cost is a mixed cost.

D.if future activity levels are expected to be beyond the relevant range.

 

84.Which of the following methods requires the most professional judgment in classifying costs?

A.Scattergraph

B.Regression analysis

C.Account analysis

D.High-low method

 

85.Each point on the scattergraph represents one pair of

A.cost and activity values.

B.variable cost and revenue values.

C.fixed cost and revenue values.

D.revenue and activity values.

 

86.Carpet Renewal dyes carpets for residential customers. The company is interested in estimating fixed and variable costs. The following data are available for the month of June when 420 carpets were dyed:

Office rent              $  1,250

Depreciation – equipment               900

Cleaning supplies              5,140

Hourly wages              11,000

Transportation (variable)              3,600

Owner’s salary                  3,100

Total               $24,990

 

Using account analysis, how much is estimated variable cost per carpet?

A.              $47.00

B.              $38.43

C.              $59.50

D.              $52.12

 

87.Lawn Cut Perfection provided data concerning the costs incurred to mow residential lawns for which customers pay $45 per mowing. Data for the past 7 months are as follows:

 

JanuaryFebruaryMarchAprilMayJuneJuly

Number of lawns mowed200110150100220120210

Mowing cost$12,900$8,120$10,200$8,200$13,060$8,400$13,280

 

How much is the estimated variable cost of mowing one lawn using the high-low method?

A.$43.00

B.$40.50

C.$44.90

D.$51.60