Cost Accounting - Easy Questions

5. Direct materials are an example of a:

a. step cost

b. mixed cost

c. fixed cost

d. variable cost

6. The following is an example of a mixed cost:

a. Supervisor's salaries

b. direct materials

c. salary plus comission on sales

d. materials used in production

8. Weakness of the high-low method include all of the following EXCEPT

a. only two observations are used to develop the cost function

b. the high and low activity levels may not be representative

c. the method is relatively complex and difficult to apply

d. the method does not detect if the cost behavior in nonlinear

7.Assume the following information:

Volume	Total Cost
90 units	$1,200
98 units	$1,300
106 units	$1,400

What is the variable cost per unit?

a. $14.78

b. $15.00

c. $12.50

d. $13.75