Question : 41. George’s Ice Cream Shop believes most of its utilities costs : 1295552

 

 

41. George’s Ice Cream Shop believes most of its utilities costs are mixed. George has collected the following data on gallons of ice cream used and related utilities’ costs for the past six months: 

 

Number of gallons used

Utilities cost

May ————

20

$   700     

June ————

30

850

July ————

40

1,100  

August ———

30

975

September —–

25

900

October ——–

22

720

 

 

 

George has run a regression analysis on the above information and has come up with the following data: 

 

Coefficients

Intercept

374.4318

X Variable 1

18.29545

 

 

Comparing the high/low method to regression analysis, to the nearest dollar, which of the following formulas would be the best predictor of total estimated mixed costs? A. Y = $300 + $20xB. Y = $374 + $18xC. Y = $900 + $30xD. Y = $18 + $374x

 

42. Hill Top Products has run a regression analysis comparing total production and utilities’ costs for the past six months. The regression analysis shows an R square (R2) of .86. Which of the following statements best describes the meaning of R2? A. 86 percent of the company’s total costs are utilities costs.B. 86 percent of the variation in utilities costs is not explained by the increase or decrease in production.C. 86 percent of the variation in utilities costs is explained by the increase or decrease in production.D. 86 percent of the company’s total costs are fixed costs and the remaining 14 percent are variable costs.

 

43. In regression analysis, an R square (R2) of 1.0 would indicate: A. that 1 percent of the data points are on the regression line.B. that 1 percent of the total mixed costs can be attributable to fixed costs.C. that 1 percent of the total mixed costs can be attributable to variable costs.D. that there is a perfect correlation between the independent and dependent variables.

 

44. The high/low method: A. considers only the highest and lowest costs for a given time period.B. is superior to regression analysis.C. considers all data points available.D. uses the data points for only the high and low levels of activity.

 

45. When using the high/low method, the change in cost divided by the change in volume is: A. the fixed cost per unit.B. the mixed cost per unit.C. the variable cost per unit.D. the total cost per unit.

 

46. Mr. Quik Printers documented the number of copies it made for customers as well as total overhead costs for the past five months as follows: 

 

 

Number of copies

Total overhead costs

 

October ————-

230,000

$7,400

 

November ———-

240,000

7,500

 

December ———-

280,000

8,000

 

January ————-

265,000

7,700

 

February ———–

248,000

7,550

 

 

 

 

Refer to Mr. Quik Printers information above. Using the high/low method, what is the variable cost per unit? A. $  .012B. $  .030C. $33.11D. $83.33

 

47. Mr. Quik Printers documented the number of copies it made for customers as well as total overhead costs for the past five months as follows: 

 

 

Number of copies

Total overhead costs

 

October ————-

230,000

$7,400

 

November ———-

240,000

7,500

 

December ———-

280,000

8,000

 

January ————-

265,000

7,700

 

February ———–

248,000

7,550

 

 

 

 

Refer to Mr. Quik Printers information above. Using the high/low method, what is the overhead cost equation? A. Y = $400 + $.030xB. Y = $4,640 + $.012xC. Y = $7,630 + $.001xD. Y = $5,566 + $.008x

 

48. Cardinal Cleaners documented the gallons of cleaning solvent it used as well as total overhead costs for the past five months as follows: 

 

 

Number of gallons

Total overhead costs

 

July ——————

160

$6,500 

 

August ————–

150

6,100

 

September ———-

155

6,700

 

October ————-

175

7,000

 

November ———-

170

6,800

 

 

 

 

Refer to the Cardinal Cleaners information above. Using the high/low method, what is the variable cost per unit? A. $  25B. $ .03C. $900D. $  36

 

49. Cardinal Cleaners documented the gallons of cleaning solvent it used as well as total overhead costs for the past five months as follows: 

 

 

Number of gallons

Total overhead costs

 

July ——————

160

$6,500 

 

August ————–

150

6,100

 

September ———-

155

6,700

 

October ————-

175

7,000

 

November ———-

170

6,800

 

 

 

 

Refer to the Cardinal Cleaners information above. Using the high/low method, what is equation to predict total overhead costs? A. Y = $700 + $36xB. Y = $900 + $25xC. Y = $175 + $41xD. Y = $100 + $40x

 

50. Cardinal Cleaners documented the gallons of cleaning solvent it used as well as total overhead costs for the past five months as follows: 

 

 

Number of gallons

Total overhead costs

 

July ——————

160

$6,500 

 

August ————–

150

6,100

 

September ———-

155

6,700

 

October ————-

175

7,000

 

November ———-

170

6,800

 

 

 

 

Refer to the Cardinal Cleaners information above. Cardinal uses the high/low method to predict total overhead costs. If Cardinal anticipates using 200 gallons of solvent in December, what are expected total overhead costs? A. $9,778B. $7,900C. $8,133D. $8,000

 

 

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