Horn_CH_10TB 13

A y26672 184x b y21360 152x c y10112 864x d y3600

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Unformatted text preview: : The Barnett Company has assembled the following data pertaining to certain costs that cannot be easily identified as either fixed or variable. Barnett Company has heard about a method of measuring cost functions called the high-low method and has decided to use it in this situation. Cost $24,900 24,000 36,400 44,160 45,000 123) Hours 5,250 5,500 7,500 9,750 9,500 What is the cost function? A) y = $43,191 + $0.19X B) y = $4,875 + $5.25X C) y = $41,900 + $0.23X D) y = $2,430 + $4.28X Answer: D Explanation: D) b Diff: 3 T a 4 AACSB: Analytical skills 124) What is the estimated total cost at an operating level of 8,000 hours? A) $43,740 B) $36,670 C) $46,875 D) $37,125 Answer: B Explanation: B) b $ a $ high-low method, cost predictions Objective: 4 AACSB: Analytical skills Answer the following questions using the information below: Presented below are the production data for the first six months of the year for the mixed costs incurred by Gallup Company. Month January February March April May June Cost $4,890 4,024 6,480 8,840 5,800 7,336 Units 4,100 3,200 5,300 7,500 4,800 6,600 Gallup Company uses the high-low method to analyze mixed costs. 125) How would the cost function be stated? A) y = $440 + $1.12X B) y = $3,562.30 + $0.144X C) y = $107.20 + $1.224X D) y = $7,850 + $0.132X Answer: A Explanation: A) b Diff: 3 T a 4 AACSB: Analytical skills 126) What is the estimated total cost at an operating level of 5,000 units? A) $6,227.20 B) $6,040.00 C) $4,283.20 D) $8,510.00 Answer: B Explanation: B) b $ a y high-low method, cost predictions Objective: 4 AACSB: Analytical skills Answer the following questions using the information below: The Gangwere Company has assembled the following data pertaining to certain costs that cannot be easily identified as either fixed or variable. Gangwere Company has heard about a method of measuring cost functions called the high-low method and has decided to use it in this situation. Month January February March April May June 127) Cost $40,000 24,400 31,280 36,400 44,160 42,400 Hours 3,500 2,000 2,450 3,000 3,900 3,740 How is the cost function stated? A) y = $26,672 + $1.84X B) y = $21,360 + $1.52X C) y = $10,112 + $8.64X D) y = $3,600 + $10.40X Answer: D Explanation: D) b Diff: 3 T a 4 AACSB: Analytical skills 128) What is the estimated total cost at an operating level of 2,850 hours? A) $25,692 B) $33,240 C) $32,016 D) $34,736 Answer: B Explanation: B) b $ a y high-low method, cost predictions Objective: 4 A...
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