Which of the following statements related to cost estimation methods is false? O a. The most complex method of cost estimation is the high-low method. O b. The low-high method is used to derive an estimated line of cost behavior by graphically connecting the two cost amounts identified with the highest and lowest volume levels. O c. None of the given answers. d. The least-squares regression method is the most accurate and reliable method to determine the cost behavior compared to scatter-graph plot and high-low methods. O e. The three methods determine a slope and an intercept.

Which of the following statements related to cost estimation methods is false? O a. The most complex method of cost estimation is the high-low method. O b. The low-high method is used to derive an estimated line of cost behavior by graphically connecting the two cost amounts identified with the highest and lowest volume levels. O c. None of the given answers. d. The least-squares regression method is the most accurate and reliable method to determine the cost behavior compared to scatter-graph plot and high-low methods. O e. The three methods determine a slope and an intercept.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Optimal replacement interval is negatively correlated with which of the following? a. First cost b. Operating and maintenance cost c. MARR d. None of the above.
What circumstances might create distortions where estimated costs are not an accurate representation of true cost?
Directions: Choose the right answer in the multiple-choice 1. What is the cost incurred in the past? A. Future cost B. Unknown cost C. Already incurred cost D. Accounting Cost E. None of the above 2. The formula: Y=a+bx+cz is an example ofA. Simple regressionB. Multiple regressionC. Linear programmingD. None of the above 3. If “r” between two variables is zero, how might the scatter diagram of these variables appear?A. A least-square line that slopes to the rightB. A least-square line that slopes to the leftC. Under this case, the scatter diagram could not be plotted in the graphD. None of the above 4. In cost accounting, relevant range is the range over which A. Production is stableB. Costs are stable and constantC. Total fixed cost fluctuatesD. Cost relationship Is not validE. None of the above 5. Which of the following is a controller’s responsibility? A. Provision for capitalB. Custodian of fundsC. Credit and collectionD. Arranging shirt…
12) Which of the following techniques is not used to analyze cost behavior? A) Least-squares regression. B) Visual-fit method. O High-low method. D) Multiple regression. E) Linear programming.
The most popular method used to calculate VaR is: Group of answer choices B. Parametric VaR D. All three methods are equal in popularity. C. Monte Carlo Analysis A. Historical Simulation
Explain how the high-low method determines:a. The variable portion of a semivariable cost.b. The fixed portion of a semivariable cost.
How does it compare with the NPV based on the WACC method? (Select the best choice below.) A. The NPV computed using the FTE method cannot be compared to the NPV based on the WACC method. B. The NPV computed using the FTE method is always higher than the NPV based on the WACC method. C. The NPV computed using the FTE method is always lower than the NPV based on the WACC method. D. The NPV computed using the FTE method is the same as the NPV based on the WACC method.
If computational and record-keeping costs are about the same under both FIFO and weighted-average costing, which method, if any, will generally be preferred? Multiple Choice Weighted-average costing FIFO costing None of these. The answer cannot be determined with so little information.
The independent variable in regression analysis is: Multiple Choice Usually expressed as a range of values. The cost to be estimated. Hard to define because of its independence. The cost driver used to estimate the value of the dependent variable. Always a volume-based cost driver.
The simplifying assumption that costs and volume vary in straight-line relationships makes the analysis of cost behav-ior much easier. What factors make this a reasonable and useful assumption in many cases?
A method that estimates cost behavior by using just the highest and lowest volume levels is called the: Multiple Choice O O Scatter method. High-low method. Least-squares method. Break-even method. Step-wise method.
Which of the following statements is FALSE? O a. The mark up is a percentage applied to base cost. O b. A major advantage of mark up pricing is that standard mark ups are easy to apply. Oc. The mark up can be calculated using a variety of bases. O d. The mark up is an absolute rule.