Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN: 9781337115773
Author: Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher: Cengage Learning
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Question
Chapter 3, Problem 3MCQ
To determine
Identify the fixed cost in an automobile insurance company.
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When compleling an insurance application, a producer should
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A.complete as much of the applicalion as possible before meeting with he applicant to save time
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B.request hat the applicant review the completed application before signing it
C.avoid asking the applicant questions on he application which may be embarrassing
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D.omit information from he application which may cause the application to be rejected by the insurance company
When compleling an insurance applicalion, a producer should
A. complete as much of the application as possible before meeting wilh the applicant to save lime
B. request that the applicant review he completed application before signing it
C. avoid asking the applicant questions on he application which may be embarrassing
D. omit informalion from lhe application which may cause the application to be rejected by the insurance company
Which of the following would not be an appropriate subaccount for an Insurance Expense Account?
Multiple Choice
Auto Insurance Expense.
Liability Insurance Expense.
Rent Expense.
Renter Insurance Expense.
Chapter 3 Solutions
Managerial Accounting: The Cornerstone of Business Decision-Making
Ch. 3 - Prob. 1DQCh. 3 - What is a driver? Give an example of a cost and...Ch. 3 - Suppose a company finds that shipping cost is...Ch. 3 - Some firms assign mixed costs to either the fixed...Ch. 3 - Explain the difference between committed and...Ch. 3 - Explain why the concept of relevant range is...Ch. 3 - Why do mixed costs pose a problem when it comes to...Ch. 3 - Describe the cost formula for a strictly fixed...Ch. 3 - Describe the cost formula for a strictly variable...Ch. 3 - What is the scattergraph method, and why is it...
Ch. 3 - Describe how the scattergraph method breaks out...Ch. 3 - What are the advantages of the scattergraph method...Ch. 3 - Prob. 13DQCh. 3 - What is meant by the best-fitting line?Ch. 3 - What is the difference between the unit cost of a...Ch. 3 - Prob. 16DQCh. 3 - (Appendix 3A) Explain the meaning of the...Ch. 3 - A factor that causes or leads to a change in a...Ch. 3 - Which of the following would probably be a...Ch. 3 - Prob. 3MCQCh. 3 - In the cost formula, the term 128,000,000 a. is...Ch. 3 - In the cost formula, the term 12,000 a. is the...Ch. 3 - Prob. 6MCQCh. 3 - Prob. 7MCQCh. 3 - The following cost formula for total purchasing...Ch. 3 - An advantage of the high-low method is that it a....Ch. 3 - Prob. 10MCQCh. 3 - Prob. 11MCQCh. 3 - Prob. 12MCQCh. 3 - The total cost for monthly supervisory cost in a...Ch. 3 - Yates Company shows the following unit costs for...Ch. 3 - (Appendix 3A) In the method of least squares, the...Ch. 3 - Creating and Using a Cost Formula Big Thumbs...Ch. 3 - Using High-Low to Calculate Fixed Cost, Calculate...Ch. 3 - Using High-Low to Calculate Predicted Total...Ch. 3 - Using High-Low to Calculate Predicted Total...Ch. 3 - Using Regression to Calculate Fixed Cost,...Ch. 3 - Inventory Valuation under Absorption Costing Refer...Ch. 3 - Inventory Valuation under Variable Costing Refer...Ch. 3 - Absorption-Costing Income Statement Refer to the...Ch. 3 - Variable-Costing Income Statement Refer to the...Ch. 3 - Creating and Using a Cost Formula Kleenaire Motors...Ch. 3 - Using High-Low to Calculate Fixed Cost, Calculate...Ch. 3 - Using High-Low to Calculate Predicted Total...Ch. 3 - Brief Exercise 3-28 Using High-Low to Calculate...Ch. 3 - Using Regression to Calculate Fixed Cost,...Ch. 3 - Inventory Valuation under Absorption Costing Refer...Ch. 3 - Inventory Valuation under Variable Costing Refer...Ch. 3 - Brief Exercise 3-32 Absorption-Costing Income...Ch. 3 - Brief Exercise 3-33 Variable-Costing Income...Ch. 3 - Variable and Fixed Costs What follows are a number...Ch. 3 - Cost Behavior, Classification Smith Concrete...Ch. 3 - Prob. 36ECh. 3 - Prob. 37ECh. 3 - Prob. 38ECh. 3 - Step Costs, Relevant Range Bellati Inc. produces...Ch. 3 - Matching Cost Behavior Descriptions to Cost...Ch. 3 - Examine the graphs in Exercise 3-40. Required: As...Ch. 3 - Prob. 42ECh. 3 - Prob. 43ECh. 3 - High-Low Method Refer to the information for Luisa...Ch. 3 - Scattergraph Method Refer to the information for...Ch. 3 - Method of Least Squares Refer to the information...Ch. 3 - Use the following information for Exercises 3-47...Ch. 3 - Use the following information for Exercises 3-47...Ch. 3 - Method of Least Squares, Developing and Using the...Ch. 3 - The method of least squares was used to develop a...Ch. 3 - Identifying the Parts of the Cost Formula;...Ch. 3 - Inventory Valuation under Absorption Costing...Ch. 3 - Inventory Valuation under Variable Costing Lane...Ch. 3 - Income Statements under Absorption and Variable...Ch. 3 - (Appendix 3A) Method of Least Squares Using...Ch. 3 - (Appendix 3A) Method of Least Squares Using...Ch. 3 - Identifying Fixed, Variable, Mixed, and Step Costs...Ch. 3 - Identifying Use of the High-Low, Scattergraph, and...Ch. 3 - Identifying Variable Costs, Committed Fixed Costs,...Ch. 3 - Scattergraph, High-Low Method, and Predicting Cost...Ch. 3 - Method of Least Squares, Predicting Cost for...Ch. 3 - Cost Behavior, High-Low Method, Pricing Decision...Ch. 3 - Prob. 63PCh. 3 - Variable and Fixed Costs, Cost Formula, High-Low...Ch. 3 - Cost Separation About 8 years ago, Kicker faced...Ch. 3 - Variable-Costing and Absorption-Costing Income...Ch. 3 - Refer to the information for Farnsworth Company...Ch. 3 - (Appendix 3A) Scattergraph, High-Low Method,...Ch. 3 - (Appendix 3A) Separating Fixed and Variable Costs,...Ch. 3 - (Appendix 3A) Cost Formulas, Single and Multiple...Ch. 3 - Suspicious Acquisition of Data, Ethical Issues...
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- 1. Which of the following organizations is least likely to have a liability called Deferred Revenue? An insurance company A retailer A university or a college A magazine subscription companyarrow_forwardWhich of the following is not related to Opportunity costs?    a. Salary given up to start a business    b. Rental Income given up when you live in a house you own.    c. fixed costs to be incurred when you accept a special request from an existing client.    d. None of the choicesarrow_forwardThe _______________ problem is when customers who are most likely to have a claim against an insurance company are those quickest to apply for an insurance contract. Group of answer choices a. Capital adequacy b. Default risk c. Adverse selection d. Mismatched maturityarrow_forward
- When estimating the loss reserves in car insurance, the ________________ is used to assign a loss value to each claim. This is because the individual loss amounts are insignificant while the number of claims is large. a. Judgment method b. Loss ratio method c. Average value method d. Tabular methodarrow_forwardWhich of the following is not a reason for the physical inventory count to differ from what is recognized on the companys books? A. mismanagement B. shrinkage C. damage D. sale of services to customersarrow_forwardWhich of the following is not an example of a typical external failure cost? Multiple choice question. Product recalls Warranty repairs Debugging system errors Defective product liabilityarrow_forward
- An archilect who has recently opened an office is concerned about not being able to pay employees' salaries or he office rent it the architect becomes disabled. Which of the following types of policies should this individual purchase? A. Disability Income B. Business Overhead Expense C. Major Medical D. Comprehensive Major Medicalarrow_forwardIf a prospect does NOT submit the initial premium with an application, the producer should  A.refuse tratinghe application  B.submit the application to the insurance company and advance the premium for he prospect from the agency account  C.submit the applicalion to the insurance company without the premium  D.give lhe applicant a conditional receipt and send the application to the insurance company wilhout the premiumarrow_forwardMATCH WITH THE BEST ANSWER Liability Insurance Mistakes happen. You, your employees, your equipment or your suppliers could make mistakes that ultimately end up hurting your customers, your employees or other people who are involved with your business. To protect your business from being sued, you should consider these types of insurance to limit your liability: 1.  ____General liability  A. Provides protection if you are sued by a client for errors, omissions or negligence, when performing professional services. 2.  ____Product liability  B. Covers injury to clients or staff on your premises. 3.  ____ Professional liability insurance C. Provides protection in the event that your products are defective or cause serious harm to those using them.arrow_forward
- 36. In the following liabilities, the payee is known, however, the amount may have to be estimated. Which is the exception? a. provision for restructuring costs b. provision for decommissioning costs c. provision for staff bonus d. liability on customer loyalty creditsarrow_forwardChoose only one answer as well as state their reasons/rationale for the answer chosen. 5) Testing whether or not all employees are being paid at least the minimum wage would be an example of a(n):a. Reasonableness testb. Sign checkc. Check digit verificationd. Limit checkarrow_forwardWhare are valid concerns can be challenging to running business and providing insurance coverage?arrow_forward
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