Costing - Study Mode
[#41] If coefficients are similar for two accounting periods, then single cost relationship is estimated with help of
Correct Answer
(C) pool of data
Explanation
Solution: If coefficients are similar for two accounting periods, then single cost relationship is estimated with help of pool of data. Cost pools is an accounting term that refers to groups of accounts serving to express the cost of goods and service allocatable within a business or manufacturing organization.
[#42] Relationship between independent variable and dependent variable must be
Correct Answer
(D) economically plausible
Explanation
Solution: Relationship between independent variable and dependent variable must be economically plausible. The cost function shows a positive economically plausible relationship between machine-hours and maintenance costs.
[#43] In adjustment issues of costing, database must contain reliable measure of
Correct Answer
(B) cost driver and cost
Explanation
Solution: In adjustment issues of costing, database must contain reliable measure of cost driver and cost. A cost driver is the unit of an activity that causes the change in activity's cost.
[#44] If difference in costs is $7000 and difference in machine hours of is $18000, then slope coefficient would be
Correct Answer
(B) 0.39
Explanation
Solution: Slope coefficient = Difference in costs ÷ Difference in machine hours = $7000 ÷ $18000 = 0.39
[#45] In adjustment issues and data collection, inflation affects the
Correct Answer
(A) cost driver and cost
Explanation
Solution: In adjustment issues and data collection, inflation affects the cost driver and cost. A cost driver is the unit of an activity that causes the change in activity's cost.