5. Lawson Corporation has the following data for use of its machinery

Month Usage Cost Jun 600 $750 Jul 550 725 Aug 420 550 Sept 500 650 Oct 450 570 Refer to Lawson Corporation. Using the high-low method, compute the fixed cost element (to the nearest whole dollar). Please choose the closest answer. A. $83 B. $138 C. $72 D. $115

6. Bentonville Medical Center has provided you with the following budget information for July: Cash collections $910,000 July 1 cash balance 30,000 Cash disbursements 1,050,600 Bentonville has a policy of maintaining a minimum cash balance of $25,000 and borrows only in $1,000 increments. How much will Bentonville borrow in July? A. $101,000 B. $ 120,000 C. $136,000 D. $ 117,000

7.

What is the assumption that underlies the percent-of-sales method?

	A.	A firm undergoes rapid growth.
	B.	A firm operates at full capacity.
	C.	A firm plans to evaluate divisional performance.
	D.	A firm pursues cost reductions.

8.

Given actual amounts of a mixed (semivariable) cost for various levels of output, which of the following will give the most precise mathematical measure of the fixed and variable components with the availability of Excel spreadsheets?

	A.	High-low method
	B.	Scattergram approach
	C.	Regression analysis (Least-squares method)
	D.	Bayesian statistics