Costing - Study Mode

[#131] Considering relationship of variables, relationship in which activity cost is included in dependent variable, which has similar cost driver is classified as
Correct Answer

(D) homogeneous relationship

Explanation

Solution: Considering relationship of variables, relationship in which activity cost is included in dependent variable, which has similar cost driver is classified as homogeneous relationship.

[#132] Method which considers lowest and highest values of cost driver and cost within relevant range is called
Correct Answer

(D) high low method

Explanation

Solution: Method which considers lowest and highest values of cost driver and cost within relevant range is called high low method. In cost accounting, the high-low method is a way of attempting to separate out fixed and variable costs given a limited amount of data. The high-low method involves taking the highest level of activity and the lowest level of activity and comparing the total costs at each level.

[#133] Vertical dashed line in graphical representation of cost function represents the
Correct Answer

(C) relevant range

Explanation

Solution: Vertical dashed line in graphical representation of cost function represents the relevant range. The relevant range refers to a specific activity level that is bounded by a minimum and maximum amount. Within the designated boundaries, certain revenue or expense levels can be expected to occur.

[#134] In dependent variable cost pool, relationship between individual cost items and cost drivers can be classified as
Correct Answer

(A) no homogeneous relationship

Explanation

Solution: In dependent variable cost pool, relationship between individual cost items and cost drivers can be classified as no homogeneous relationship.

[#135] Value, which measures that how large is value of standard error in relevance to value of estimated coefficient is termed as
Correct Answer

(A) t-value

Explanation

Solution: Value, which measures that how large is value of standard error in relevance to value of estimated coefficient is termed as t-value.