1. Which of the following statements is NOT true about costs per unitwithin the relevant range?

A. Fixed costs decrease in proportion to increases in volume.

B. Mixed costs decrease but not in direct proportion to increases in volume.

C. Variable costs stay constant with changes in volume.

D. Curvilinear costs stay constant with changes in volume.

2. How would the equation for total costs be written using the following? y = total costs v = variable cost per unit of activity x = volume of activity f = total fixed costs

A. y = xv

B. y = xv + f

C. y = xf

D. y = f

3. A utility bill consisting of a monthly base, plus an added amount based on usage, is classified as a:

A. fixed cost.

B. mixed cost.

C. curvilinear cost.

D. variable cost.

4. A company is analyzing its mixed costs. During July, its busiest month, a company had total labor hours of 14,000 and total costs of $40,000. During February, its slowest month, the company had labor hours of 8,000 and total costs of $25,000. The company is planning for 12,000 direct labor hours next April. How many dollars should the company budget for fixed costs during April?

A. $5,000

B. $6,000

C. $35,000

D. $36,000

5. A company is analyzing its mixed costs. During July, its busiest month, a company had total labor hours of 14,000 and total costs of $40,000. During February, its slowest month, the company had labor hours of 8,000 and total costs of $25,000. The company is planning for 12,000 direct labor hours next April. How many dollars should the company budget for total costs during April?

A. $5,000

B. $6,000

C. $30,000

D. $35,000

6. Which of the following statements is true regarding regression analysis?

A. Regression analysis considers all of the data points for determining the line that best fits the data so is usually more accurate than the high-low method.

B. Regression analysis helps generate a statistic, called the R-square, which tells how well the line fits the data points.

C. Regression analysis helps managers implement activity-based costing systems.

D. All of the above are true.

7. The difference between absorption costing and variable costing is:

A. the treatment of fixed MOH.

B. the timing with which fixed MOH is expensed.

C. both of the above are differences.

D. none of the above are differences.

8. Which of the following is NOT true regarding an income statement organized according to the contribution margin approach?

A. The contribution margin income statement is organized by cost behavior.

B. Operating income will always be the same as operating income in a traditional income statement regardless of changes in inventory levels.

C. All fixed costs, including fixed MOH, are expensed below the contribution margin line.

D. The contribution margin is equal to sales revenue minus variable expenses.