Reference no: EM132622952

Problem 1: On the basis of this information, the fixed cost was:

A. $184,800.
B. $210,000.
C. $550,000.
D. $734,800.
E. $760,000.

Problem 2: Northlake, Inc., uses the high-low method to analyze cost behavior. The company observed that at 20,000 machine hours of activity, total maintenance costs averaged $10.50 per hour. When activity jumped to 24,000 machine hours, which was still within the relevant range, the average total cost per machine hour was $9.75. On the basis of this information, the company's fixed maintenance costs were:

A. $24,000.
B. $90,000.
C. $210,00.
D. $234,000.
E. an amount other than those listed above.

Problem 3: The following data relate to the Lisle Company for May and August of the current year:

May and August were the lowest and highest activity levels, and Lisle uses the high-low method to analyze cost behavior. Which of the following statements is true?

A. The variable maintenance cost is $43 per hour.
B. The variable maintenance cost is $45 per hour.
C. The variable maintenance cost is $47 per hour.
D. The fixed maintenance cost is $725,000 per month.
E. More than one of the above statements is true.

Problem 4: In regression analysis, the variable that is being predicted is known as the:

A. independent variable.
B. dependent variable.
C. explanatory variable.
D. interdependent variable.
E. functional variable.

Problem 5:  Wesley Enterprises has determined that three variables play a key role in determining company revenues. To arrive at an objective forecast of revenues for the next accounting period, Wesley should use:

A. simple regression.
B. multiple regression.
C. a scatter diagram.
D. complex regression.
E. the high-low method.