Section 7- Chap 5&6

Section 7- Chap 5&6 - AEM 323 Section Problem Set 7...

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Section Problem Set 7 From Chapter 5 Problem 1 1. Mixed Cost _____ 2. Account Analysis _____ 3. Contribution Approach _____ 4. Independent Variable _____ 5. Curvilinear Cost _____ 6. Engineering Approach _____ 7. Step Variable Cost _____ 8. Discretionary Fixed Cost _____ 9. Contribution Margin _____ 10. Activity Base _____ 11. Least-squares Method _____ 12. Relevant Range _____ A. A method for analyzing cost behavior in which each account is classified as either variable or fixed based on the analyst’s prior knowledge of how the cost in the account behaves. B. Sales Revenue – Variable Expenses C. The range of activity within which assumptions about variable and fixed cost behavior are valid. D. A cost that contains both fixed and variable costs. E. A detailed analysis of cost behavior based on an industrial engineer’s evaluation of the inputs that are required to carry out a particular activity and the prices of those inputs. F. A measure of whatever causes the incurrence of a variable cost. G. The cost of a resource that is obtainable only in very large chunks and that increases and decreases only in response to fairly wide changes in activity. H. A relation between cost and activity that is a curve rather than a straight line. I. An income statement format that is geared to cost behavior in that costs are separated into variable and fixed categories rather than being separated according to the functions of production, sales, and administrative. J. A method of separating a mixed cost into its fixed and variable elements by fitting a regression line that minimizes the sum of the squared errors. K. Those fixed costs that arise from annual decisions.
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Section 7- Chap 5&6 - AEM 323 Section Problem Set 7...

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