accounting 1.4

1. In a linear cost function, the fixed cost is o independent of the cost driver o independent of the intercept o dependent on the cost driver o dependent on the independent variable 2. A disadvantage of the high-low method to estimate a cost function is: o historical data may hide past inefficiencies o historical data my not reflect changes made in the organization o historical data may be obsolete o all the above 3. Shelly decides to open a side business selling custom artwork. Last year she produced 110 paintings at a cost of $440. The cost is variable. Next year Shelly expects to produce 115 paintings. Shelly's relevant range of production is 75 to 200 units. If 115 paintings are produced, what is the expected variable cost? o $420 o $450 o $440 o $460