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Cost Behavior & Estimation(Quick Test #1)

Harold Averkamp, CPA, MBA

After you have answered all 20 questions, click "Grade This Quick Test" at the bottom of the page to view your grade and receive feedback on your answers.

Note: Some of the following test questions may not have been covered in the Explanation or Practice Quiz for this topic. For more insight regarding a specific question, use the search box at the top of the page.

    1. 1. Prior to using a cost estimation technique, it is prudent to first prepare a __________ of the activity and its related cost.

    2. 2. A cost or the volume of the related activity that is not consistent with the other observations plotted on a scattergraph is referred to as an __________.

    3. 3. The total dollar amount of a fixed cost is assumed to remain unchanged within a relevant __________ of activity or volume.

    4. 4. A statistical method for determining the formula of the best fitting line between costs and volume or activities is __________ analysis.

    5. 5. A cost that is part fixed and part variable is referred to as a semivariable or __________ cost.

    6. 6. When there is an increase in volume within a reasonable range, the variable cost per unit is assumed to __________.

    7. 7. As volume increases within a reasonable range, the fixed costs per unit will __________.

    8. 8. Within a relevant range of activity, fixed costs do not change __________.

    9. 9. In relationship to the machine hours used to apply manufacturing overhead to products, which of the following is likely to be a fixed manufacturing cost?

    10. 10. When graphing the cost of electricity at various levels of machine hours, the dollars of total electricity costs are indicated on the __________.

    11. 11. In the cost equation, y = a + bx, the variable cost per unit of activity is represented by __________.

    12. 12. The cost equation, y = a + bx, implies that a __________ relationship exists.

    13. 13. In the cost equation, y = a + bx, “y” is the __________.

    14. 14. In the cost equation, y = a + bx, “x” is the __________.

    15. 15. In the cost equation y = a + bx, “a” is the __________.

    16. 16. When graphing a cost that is linear, the amount of the fixed cost is the point that intercepts the __________.

    17. 17. The slope of the total cost line reflects the __________ cost rate per unit.

    18. Use the following information for answering Questions 18 - 20:
      The amounts of a company's monthly electric bills and the number of hours that the production machines were operating between the meter reading dates shown on the electric bills were as follows:

    19. 18. Using the high-low method, the variable cost of electricity per machine hour is $__________.

    20. 19. Using the high-low method, the amount of fixed cost per month is $__________.

    21. 20. When the number of machine hours are 2,730 the estimated amount of the electricity cost is $__________.

Any questions left unanswered will be marked incorrect.

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About the Author

Harold Averkamp

For the past 52 years, Harold Averkamp (CPA, MBA) has worked as an accounting supervisor, manager, consultant, university instructor, and innovator in teaching accounting online. He is the sole author of all the materials on

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