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Test 2 review Spring 2011

Test 2 review Spring 2011 - ACG 2071 Spring 2011 Test#2...

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ACG 2071 – Spring 2011 Test #2 Review Sheet (chapters 6 thru 9) Note – the information provided is intended to be a list of key topics potentially included on the test. More detailed knowledge of the topics listed, including the capability of working problems, is required to answer many of the questions. There may also be other information not included on this review sheet that could be tested. 52 questions (10 T/F, 42 M/C) - 150 minutes maximum time allowed, please keep track of time. Allowed 3x5 handwritten note card, non-programmable calculator --------------------------------------------------------------------------------------------------------------- Chapter 6 (Ex 6-23, 24, 41, 55) Fixed costs – costs that remain the same in total, but change on a per unit bases, with changes in production volume. Variable costs – costs that remain the same on a per unit basis, but change in total, with changes in production volume. Mixed costs – costs which have a fixed and variable component Committed Fixed costs vs. Discretionary fixed costs Graphs of each type of cost; fixed, variable, mixed Relevant range – the normal range of units of production where the fixed and variable relationship holds. Cost Structure – proportion of fixed and variable expenses in organization. Cost equation: Total Costs = [Variable Costs per unit x # of units] + Fixed Costs Regression analysis – a statistical method used to estimate fixed and variable components of a mixed cost. High-low method – another method used to estimate fixed and variable components of a mixed cost. Step 1 - estimate variable cost per unit – change in cost / change in volume Step 2 – estimate fixed cost – use cost equation

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Test 2 review Spring 2011 - ACG 2071 Spring 2011 Test#2...

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