Wednesday, June 29, 2011

How would the cost function be stated?

ACCOUNTING

Multiple Choice

Presented below are the production data for the first six months of the year for the mixed costs incurred by Gallup Company.



Month Cost Units

January $4,890 4,100

February 4,024 3,200

March 6,480 5,300

April 8,840 7,500

May 5,800 4,800

June 7,336 6,600



Gallup Company uses the high-low method to analyze mixed costs.


How would the cost function be stated?

a. y = $440 + $1.12X

b. y = $3,562.30 + $0.144X

c. y = $107.20 + $1.224X

d. y = $7,850 + $0.132X

Click here for the SOLUTION

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