Reference no: EM132622927

Problem 1: The method of cost estimation that fits a cost line between two data points is:

A. least squares regression.
B. high-low.
C. account classification.
D. multiple regression.

Problem 3: Technical Engineering presently leases a copying machine on a monthly basis. The lease agreement requires a fixed fee each month in addition to a charge per copy. Technical Engineering made 2,400 copies and paid a total of $162 in rent in September and in October they paid $195 for 3,500 copies. Determine Technical Engineering's variable cost per copy.

A. $0.06
B. $0.04
C. $0.03
D. $0.01

Problem 3: Yang Manufacturing makes a product called Yin. The relevant range of operations is between 2,500 units and 10,000 units of Yin per month. Per unit costs at two activity levels are as follows: 5,000 units at $17.00 per unit; 7,500 units at $13.00 per unit. Determine their total cost if Yang produces 10,000 units.

A. $130,000
B. $125,000
C. $110,000
D. $100,000

Problem 4: The Longreach Toy Factory has determined machine hours to be the cost driver of the company's electricity costs. During the first six months of the year, the company incurred the following electricity costs:

Month           Machine Hours           Electricity Cost

Jan                      780                        $8,200
Feb                     720                          $8,360
Mar                     800                            $8,950
Apr                      900                              $9,360
May                     950                             $9,625
Jun                    920                               $9,150

Using the high-low method, estimate the variable cost per machine hour.

A. $8.38
B. $7.44
C. $5.50
D. None of the answers is correct.

Problem 5: A regression model in which more than one independent variable is used to predict the dependent variable is called a:

A. simple regression model.
B. multiple regression model.
C. dependent model.
D. B and C