Costing – Set 6 January 30, 2025 by aasi 0% Report a question What’s wrong with this question? You cannot submit an empty report. Please add some details. 1234567891011121314151617181920212223242526272829303132333435363738394041424344454647484950 Costing – Set 6 Dear ! This is Costing – Set 6 Quiz and it contains 50 questions. Keep Learning! 1 / 50 1) In specification analysis, assumptions related to linearity states but linearity must be within insignificant range irrelevant range relevant range significant range 2 / 50 2) To decide whether cost is variable cost or fixed cost with respect to some specific activity depends upon unit of production units of labour time horizon units of inventory 3 / 50 3) Learning curve models include incremental production learning model cumulative average time learning model incremental unit time learning model both a and b 4 / 50 4) Cost that has elements of variable and fixed costs at same time is semi variable cost mixed cost Both B and C variable cost 5 / 50 5) Situation in which two or more independent variables are highly correlated is known as division linearity multi-collinearity cost linearity price linearity 6 / 50 6) Regression Analysis Method of quantitative analysis of cost function considers all data points Four data points Two data points One data point 7 / 50 7) First step in estimation of cost function by using quantitative analysis is to choose independent variable choose dependent variable choose price estimation method choose cost estimation method 8 / 50 8) Work measurement method of cost estimation is also called unit engineering method measuring engineering method industrial engineering method price engineering method 9 / 50 9) Examples of nonlinear cost functions are step price functions step constant functions step cost functions step object functions 10 / 50 10) Chances of cost to be considered as variable are more, if the time horizons are short time horizons are relevant time horizons are long time horizons are irrelevant 11 / 50 11) An estimated coefficient, which indicates degree by which estimated values are affected by random factors is known as variance of estimated coefficient weighted error of estimated coefficient standard error of estimated coefficient average of estimated coefficient 12 / 50 12) In linear cost function, which is y = a + bx, y is classified as predicted variable cost predicted cost predicted price predicted fixed cost 13 / 50 13) If difference in costs is $32000 and slope coefficient is 0.40, then difference in machine hours would be $12,800 $22,800 $80,000 $70,000 14 / 50 14) If actual result is $25000 and flexible budget amount is $11000, then flexible budget amount is $36,000 $46,000 $14,000 $56,000 15 / 50 15) Third step in estimation of cost function, by using quantitative analysis is collection of data for cost and cost object independent variable and cost driver price and cost driver dependent variable and cost driver 16 / 50 16) Considering relationship of variables, relationship in which activity cost is included in dependent variable, which has similar cost driver is classified as heterogeneous relationship no homogeneous relationship homogeneous relationship extreme relationship 17 / 50 17) In Regression Analysis, testing of assumptions if these are true or not is classified as significance analysis specification analysis weighted analysis average analysis 18 / 50 18) If an unexplained variation is 456870 and total variation is 955000, then coefficient of determination will be 0.4783 0.5216 0.5425 0.4528 19 / 50 19) In plotting of cost functions, level of activities according to which charged cost is represented on term axis y-axis x-axis unit axis 20 / 50 20) Function used to measure decline in labour hours per unit as units of production increases is called mixed curve fixed curve linear curve learning curve 21 / 50 21) Vertical dashed line in graphical representation of cost function represents the relevant range cost representation graphical representation irrelevant range 22 / 50 22) In estimation of cost functions, variations in a single activity level represents the related fixed cost related total costs related per unit cost related variable cost 23 / 50 23) In quantitative analysis of estimating cost function, last and foremost step is to evaluate variable driver evaluate demand driver evaluate price driver evaluate cost driver 24 / 50 24) If an unexplained variation is 350050 and total variation is 700505, then coefficient of determination would be 2 0.7003 0.5003 3 25 / 50 25) Cause and effect relationship between activity and costs is result of all of these contractual agreement knowledge of operations measureable unit relationship 26 / 50 26) In dependent variable cost pool, relationship between individual cost items and cost drivers can be classified as homogeneous relationship heterogeneous relationship an extreme relationship no homogeneous relationship 27 / 50 27) In adjustment issues of costing, database must consider wide range values of cost object mixed object fixed object cost driver 28 / 50 28) In estimation of cost function, an example of independent variable is quantity stored quality of product level of activity quantity manufactured 29 / 50 29) Worse fit between estimated cost and actual observations is shown on regression line with variable residual terms smaller residual terms larger residual terms zero residual terms 30 / 50 30) Line which uses to join observations with lower and highest values of cost driver is called horizontal line vertical line straight line curved line 31 / 50 31) A technique which minimizes sum of squared vertical difference, to determine regression line is considered as most square technique positive square technique least square technique negative square technique 32 / 50 32) If residual error is 51 and predicted cost value is 37, then observed cost value will be 14 88 24 68 33 / 50 33) Formula of 1 – unexplained variation / total variation is used to calculate coefficient of prediction coefficient of index coefficient of residual coefficient of determination 34 / 50 34) If actual result is $26000, flexible budget amount is $13000, then flexible budget amount will be $49,000 $39,000 $15,000 $13,000 35 / 50 35) Method which considers lowest and highest values of cost driver and cost within relevant range is called constant equation high low method variable equation low high method 36 / 50 36) Value, which measures that how large is value of standard error in relevance to value of estimated coefficient is termed as b-value t-value c-value d-value 37 / 50 37) Relationship between cost and cost driver is economically plausible if goodness of fit has index values has no meaning has no index values has meaning 38 / 50 38) Cause and effect relationship that exists between change in total cost level and change in level of activity, is measured with help of cost driver estimation driver production driver price driver 39 / 50 39) Better fit between estimated cost and actual observations is represented by smaller residual terms variable residual terms zero residual terms larger residual terms 40 / 50 40) For slope coefficient b, value of estimated coefficient is considered as c-value d-value b-value t-value 41 / 50 41) Cost analysis method, which uses mathematical method to use fit between past data observations and cost functions is termed as conference analysis method account analysis method qualitative analysis method quantitative analysis method 42 / 50 42) In a given scenario, if cost is considered as indirect cost then independent variable will be considered as price allocation base supply allocation base cost allocation base demand allocation base 43 / 50 43) If actual selling price is $500, actual result is $250 and actual units sold are 350, then selling price variance will be $67,500 $87,500 $57,500 $97,500 44 / 50 44) Slope coefficient of linear cost function is one zero two three 45 / 50 45) Method, which considers cost and cost drivers of departments such as employee relations and process engineering is termed as manufacturing method conference method inference method pricing method 46 / 50 46) If difference between costs linked to highest and lowest observation of cost driver is $36000 and observation of cost driver is 30 machine hours, then slope coefficient would be $1,400 $1,600 $1,800 $1,200 47 / 50 47) Flexible budget variance for revenues of company is classified as profit variance investment variance primary variance selling price variance 48 / 50 48) In Regression Analysis, if an observed cost value is 85 and disturbance error is 25 then predicted cost value will be 60 110 70 125 49 / 50 49) Function which is used to measure decline in per unit cost of different business functions is classified as fixed curve experience curve discrete curve mixed curve 50 / 50 50) In regression analysis, if predicted cost value is 65 and observed cost value is 19 then disturbance term will be 36 46 56 76 Your score isThe average score is 0%🎉 Challenge alert! 💡 Share this quiz with your friends and see who scores the highest! 🏆🤩🔥 LinkedIn Facebook Follow Us @ 0% Restart quiz Exit We’d love to hear your thoughts! 📝 Share your valuable review with us. 🙌 🌟 Thank you for your support! 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