Questions from Cost Accounting

Q: What are the four key assumptions examined in specification analysis in the

What are the four key assumptions examined in specification analysis in the case of simple regression?

Q: “Multicollinearity exists when the dependent variable and the independent variable are

“Multicollinearity exists when the dependent variable and the independent variable are highly correlated.” Do you agree? Explain.

Q: Describe the account analysis method for estimating a cost function.

Describe the account analysis method for estimating a cost function.

Q: In 2017, Hart & Sons, a small environmental-testing

In 2017, Hart & Sons, a small environmental-testing firm, performed 11,400 radon tests for $260 each and 15,000 lead tests for $210 each. Because newer homes are being built with lead-free pipes, lead...

Q: When using the high-low method, should you base the

When using the high-low method, should you base the high and low observations on the dependent variable or on the cost driver?

Q: Do companies in either the service sector or the merchandising sector make

Do companies in either the service sector or the merchandising sector make choices about absorption costing versus variable costing?

Q: Name four approaches to estimating a cost function.

Name four approaches to estimating a cost function.

Q: Assume variable manufacturing overhead is allocated using machine-hours. Give

Assume variable manufacturing overhead is allocated using machine-hours. Give three possible reasons for a favorable variable overhead efficiency variance.

Q: Describe the difference between a direct materials efficiency variance and a variable

Describe the difference between a direct materials efficiency variance and a variable manufacturing overhead efficiency variance.

Q: The main trouble with variable costing is that it ignores the increasing

The main trouble with variable costing is that it ignores the increasing importance of fixed costs in manufacturing companies. Do you agree? Why?