What are the components of mixed costs?
A. Fixed costs and variable costs
B. Relevant costs and irrelevant costs
C. Current costs and sunk costs
D. Direct costs and indirect costs
E. Controllable costs and uncontrollable costs
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Which of the following describes cost behavior?
A. The effect of cost on company performance
B. The total cost of running a business
C. The movement of material costs during inflation
D. How total costs react to changes in output
E. The ratio of costs to turnover
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Find Related Questions by Tags, levels, etc.
MICRA Manufacturing Company makes a product named as VATA. The records of some of the manufacturing expenses are easily identified as fixed or directly varied with production. The cost accountant of the company is confronted with the problem of preparing a budget for the coming year and wishes to determine the fixed and variable elements of the mixed factory overhead.
The following monthly information in respect of output and mixed factory overhead are provided as follows:
| MONTH | NUMBER OF UNITS (x) | MIXED FACTORY OVERHEAD (y) |
|---|---|---|
| JANUARY | 150 | 80 |
| FEBRUARY | 200 | 100 |
| MARCH | 300 | 135 |
| APRIL | 250 | 125 |
| MAY | 300 | 130 |
| JUNE | 250 | 120 |
| JULY | 350 | 140 |
| AUGUST | 300 | 125 |
| SEPTEMBER | 250 | 115 |
| OCTOBER | 150 | 80 |
Required:
a. Calculate the fixed and variable elements of the above mixed factory overhead using the high and low method. (5 Marks)
b. Use the linear regression analysis and determine the line of best fit. (15 Marks)
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Find Related Questions by Tags, levels, etc.
The formula which states that total contributions equal units of sales multiplied by contribution per unit is correct if the selling price:
A. And fixed cost are constant
B. And variable cost are constant
C. Varies and variable cost is constant
D. Varies and fixed cost is constant
E. And variable cost vary
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Komosa Ltd is reviewing the selling price of its product for the coming year. A forecast of the annual costs that would be incurred by Komosa Ltd in respect of this product at differing activity levels is as follows:
| Annual production (unit) | 100,000 | 160,000 | 200,000 |
|---|---|---|---|
| Direct materials (GH¢000) | 200 | 320 | 400 |
| Direct labour (GH¢000) | 600 | 960 | 1,200 |
| Overhead (GH¢000) | 880 | 1,228 | 1,460 |
The cost behavior represented in the above forecast will apply for the whole range of output up to 300,000 units per annum of this product.
Required:
i) Calculate the total variable cost per unit and total fixed overhead. (4 marks)
ii) State the total cost function. (1 mark)
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What are the components of mixed costs?
A. Fixed costs and variable costs
B. Relevant costs and irrelevant costs
C. Current costs and sunk costs
D. Direct costs and indirect costs
E. Controllable costs and uncontrollable costs
Find Related Questions by Tags, levels, etc.
Which of the following describes cost behavior?
A. The effect of cost on company performance
B. The total cost of running a business
C. The movement of material costs during inflation
D. How total costs react to changes in output
E. The ratio of costs to turnover
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
MICRA Manufacturing Company makes a product named as VATA. The records of some of the manufacturing expenses are easily identified as fixed or directly varied with production. The cost accountant of the company is confronted with the problem of preparing a budget for the coming year and wishes to determine the fixed and variable elements of the mixed factory overhead.
The following monthly information in respect of output and mixed factory overhead are provided as follows:
| MONTH | NUMBER OF UNITS (x) | MIXED FACTORY OVERHEAD (y) |
|---|---|---|
| JANUARY | 150 | 80 |
| FEBRUARY | 200 | 100 |
| MARCH | 300 | 135 |
| APRIL | 250 | 125 |
| MAY | 300 | 130 |
| JUNE | 250 | 120 |
| JULY | 350 | 140 |
| AUGUST | 300 | 125 |
| SEPTEMBER | 250 | 115 |
| OCTOBER | 150 | 80 |
Required:
a. Calculate the fixed and variable elements of the above mixed factory overhead using the high and low method. (5 Marks)
b. Use the linear regression analysis and determine the line of best fit. (15 Marks)
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
The formula which states that total contributions equal units of sales multiplied by contribution per unit is correct if the selling price:
A. And fixed cost are constant
B. And variable cost are constant
C. Varies and variable cost is constant
D. Varies and fixed cost is constant
E. And variable cost vary
Find Related Questions by Tags, levels, etc.
Komosa Ltd is reviewing the selling price of its product for the coming year. A forecast of the annual costs that would be incurred by Komosa Ltd in respect of this product at differing activity levels is as follows:
| Annual production (unit) | 100,000 | 160,000 | 200,000 |
|---|---|---|---|
| Direct materials (GH¢000) | 200 | 320 | 400 |
| Direct labour (GH¢000) | 600 | 960 | 1,200 |
| Overhead (GH¢000) | 880 | 1,228 | 1,460 |
The cost behavior represented in the above forecast will apply for the whole range of output up to 300,000 units per annum of this product.
Required:
i) Calculate the total variable cost per unit and total fixed overhead. (4 marks)
ii) State the total cost function. (1 mark)
Find Related Questions by Tags, levels, etc.
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