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# Butbetter managementdecisions costpredictionsand

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Unformatted text preview: provided by that cost function to create the should budgetary forecast for the next year. Answer: FALSE Explanation: Managers are interested in estimating past costbehavior functions because the estimates can help them make more accurate cost predictions, or forecasts, about future costs. But better management decisions, cost predictions, and estimation of cost functions can be achieved only if managers correctly identify the factors that affect costs. Diff: 2 Terms: cost function Objective: 2 AACSB: Reflective thinking 16) The engineering method of cost estimation is based on opinions from various departments and is quick and of low cost to industrial apply. Answer: FALSE Explanation: The conference method Diff: 1 Terms: cost estimation, industrial engineering method Objective: 3 AACSB: Communication 17) The account analysis method of cost estimation classifies account costs as fixed, mixed, or variable using qualitative judgments. Answer: TRUE Diff: 1 Terms: cost estimation, account analysis method Objective: 3 AACSB: Reflective thinking 18) The engineering method uses a formal mathematical method to identify cause -and-effect relationships among past data industrial observations. Answer: FALSE Explanation: Quantitative analysis methods use a formal mathematical method to identify cause-and-effect relationships among past data observations. Diff: 1 Terms: industrial engineering method Objective: 3 AACSB: Reflective thinking 19) The ve analysis method uses a formal mathematical method to identify cause -and-effect relationships among past data quantitati observations. Answer: TRUE Diff: 1 Terms: quantitative analysis method Objective: 3 AACSB: Reflective thinking 20) Individual included in the dependent variable should have the same cost driver or more than one cost function should be estimated. cost items Answer: TRUE Diff: 2 Terms: cost function, dependent variable Objective: 4 AACSB: Reflective thinking 21) The first step in estimating a cost function using quantitative analysis is to identif...
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