Managerial Accounting (5th Edition)
5th Edition
ISBN: 9780134128528
Author: Karen W. Braun, Wendy M. Tietz
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 6, Problem 6.11SE
1.
To determine
The level of relationship between the number of room-nights rented per month and the monthly utility cost
2.
To determine
To identify: Outliers in the given scatterplot.
3.
To determine
To explain: The accuracy of the high-low method used in the cost equation.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
The actual and planned data for Underwater University for the Fall term were as follows:
Actual
Planned
Enrollment
4,500
4,125
Tuition per credit hour
$120
$135
Credit hours
60,450
43,200
Registration, records, and marketing costs per enrolled student
$275
$275
Instructional costs per credit hour
$64
$60
Depreciation on classrooms and equipment
$825,600
$825,600
Registration, records, and marketing costs vary by the number of enrolled students, while instructional costs vary by the number of credit hours. Depreciation is a fixed cost.
Prepare a variable costing income statement showing the contribution margin and operating income for the Fall term.
Underwater University
Variable Costing Income Statement
For the Fall Term
Revenue
$
Variable costs:
Registration, records, and marketing costs
$
Instructional costs
Total variable costs
$
Contribution margin
$
Depreciation on classrooms and equipment
Operating income…
1. An agent for a residential real estate company in a large city would like to be able to predict the monthly rental cost for apartments, based on the size of an apartment, as defined by square footage. The agent selects a sample of 25
apartments in a particular residential neighborhood and gathers the following data: (pic)
a. Construct a scatter plot.
b. Use the least-squares method to determine the regression
coefficients b0 and b1
You wish to take an Excel course. You may enroll at one within your school or you may take a community class at the local library. You've gathered the following information to aid in your decision-making process:
Costs/Benefits
College Course
Community Course
Cost
$4,300
$1,190
Distance to course
0.20 miles (walking distance)
18 miles (driving distance)
Timing of course
Weekday
Weekend
Number of meetings
16
8
Qualitative considerations
Convenience, quality of instruction
Flexibility, brief duration
Pretend transportation (gas, mileage, and parking) cost $220 per class session at the library. If you consider solely the cost - including transportation - of each alternative, which would you choose?
Multiple Choice
College course
Community course
Both alternatives
Neither alternative
Chapter 6 Solutions
Managerial Accounting (5th Edition)
Ch. 6 - (Learning Objective 1) A graph of a variable cost...Ch. 6 - (Learning Objective 2) Which of the following is...Ch. 6 - (Learning Objective 2) In the cost equation...Ch. 6 - Prob. 4QCCh. 6 - Prob. 5QCCh. 6 - (Learning Objective 3) Which of the following is...Ch. 6 - Prob. 7QCCh. 6 - (Learning Objective 5) Which of the following is...Ch. 6 - Prob. 9QCCh. 6 - Prob. 10QC
Ch. 6 - Identify cost behavior (Learning Objectives 1 2)...Ch. 6 - Prob. 6.2SECh. 6 - Compute fixed costs per unit (Learning Objective...Ch. 6 - Prob. 6.4SECh. 6 - Predict and graph total mixed costs (Learning...Ch. 6 - Prob. 6.6SECh. 6 - Prepare and analyze a scatterplot (Learning...Ch. 6 - Prob. 6.8SECh. 6 - Use the high-low method (Learning Objective 4)...Ch. 6 - Prob. 6.10SECh. 6 - Prob. 6.11SECh. 6 - Prob. 6.12SECh. 6 - Write a cost equation given regression output...Ch. 6 - Prepare a contribution margin income statement...Ch. 6 - Prepare income statements using variable costing...Ch. 6 - Prepare income statements using variable costing...Ch. 6 - Identify cost behavior graph (Learning Objectives...Ch. 6 - Prob. 6.18SECh. 6 - Prob. 6.19SECh. 6 - Prob. 6.20AECh. 6 - Prepare income statement in two formats (Learning...Ch. 6 - Prob. 6.22AECh. 6 - Prob. 6.23AECh. 6 - Sustainability and cost estimation (Learning...Ch. 6 - Create a scatterplot (Learning Objective 3) Melody...Ch. 6 - Continuation of E6-25A: High-low method (Learning...Ch. 6 - Continuation of E6-25A: Regression analysis...Ch. 6 - Regression analysis using Excel output (Learning...Ch. 6 - Prob. 6.29AECh. 6 - Using the high-low method to predict overhead for...Ch. 6 - Using regression analysis output to predict...Ch. 6 - Performing a regression analysis to predict...Ch. 6 - Prob. 6.33AECh. 6 - Prob. 6.34AECh. 6 - Compare absorption and variable costing (Learning...Ch. 6 - Prepare a contribution margin income statement...Ch. 6 - Prepare a contribution margin income statement...Ch. 6 - Prepare income statements using variable costing...Ch. 6 - Prepare a variable costing income statement given...Ch. 6 - Prob. 6.40AECh. 6 - Prob. 6.41BECh. 6 - Prepare income statement in two formats (Learning...Ch. 6 - Use unit cost data to forecast total costs...Ch. 6 - Prob. 6.44BECh. 6 - Sustainability and cost estimation (Learning...Ch. 6 - Create a scatter plot (Learning Objective 3) Tammy...Ch. 6 - Continuation of E6-46B: High-low method (Learning...Ch. 6 - Prob. 6.48BECh. 6 - Prob. 6.49BECh. 6 - Prob. 6.50BECh. 6 - Using the high-low method to predict overhead for...Ch. 6 - Using regression analysis output to predict...Ch. 6 - Prob. 6.53BECh. 6 - Prob. 6.54BECh. 6 - Prob. 6.55BECh. 6 - Prob. 6.56BECh. 6 - Prob. 6.57BECh. 6 - Prob. 6.58BECh. 6 - Prob. 6.59BECh. 6 - Prepare a variable costing income statement given...Ch. 6 - Prob. 6.61BECh. 6 - Analyze cost behavior at a hospital using various...Ch. 6 - Analyze cost behavior (Learning Objectives 1, 2,...Ch. 6 - Prob. 6.64APCh. 6 - Prob. 6.65APCh. 6 - Prob. 6.66APCh. 6 - Analyze cost behavior at a hospital using various...Ch. 6 - Analyze cost behavior (Learning Objectives 1, 2,...Ch. 6 - Prepare traditional and contribution margin income...Ch. 6 - Prob. 6.70BPCh. 6 - Prob. 6.71BPCh. 6 - Prob. 6.72SCCh. 6 - Cost Behavior in Real Companies Choose a company...Ch. 6 - Ethics of building inventory (Learning Objective...Ch. 6 - Prob. 6.76ACT
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Bellevie college cost $7612.00 a year, the graduation rate is 25%, salary after attending is $42,400. Edmonds college cost $7,207.00 a year, the graduation rate is 27%, salary after attending is $34,300. What is the explanatory? What is the responsearrow_forwardThe quarterly sales data (number of copies sold) for a college textbook over the past three years are as follows: a. Construct a time series plot. What type of pattern exists in the data? b. Use a regression model with dummy variables as follows to develop an equation to account for seasonal effects in the data: Qtr1 = l if quarter l, 0 otherwise; Qtr2 = l if quarter 2, 0 otherwise; Qtr3 = 1 if quarter 3, 0 otherwise. c. Based on the model you developed in part (b), compute the quarterly forecasts for next year. d. Let t = 1 to refer to the observation in quarter 1 of year 1; t = 2 to refer to the observation in quarter 2 of year 1; ; and t = 12 to refer to the observation in quarter 4 of year 3. Using the dummy variables defined in part (b) and t, develop an equation to account for seasonal effects and any linear trend in the time series. e. Based upon the seasonal effects in the data and linear trend, compute the quarterly forecasts for next year. f. Is the model you developed in part (b) or the model you developed in part (d) more effective? Justify your answer.arrow_forwardBecause of high tuition costs at state and private universities, enrollments at community colleges have increased dramatically in recent years. The following data show the enrollment for Jefferson Community College for the nine most recent years: Construct a time series plot. What type of pattern exists in the data? Use simple linear regression analysis to find the parameters for the line that minimizes MSE for this time series. What is the forecast for year 10?arrow_forward
- You have been commissioned to estimate the demand curve for admission to Lake Saint- Michel, a recreational fishing site in France. To do this, you spend a day surveying visitor to the site. You divide the area around the site into 3 zones. You ask each person you interview where they come from. Based on that information, and figures on annual attendance at the park, you are able to calculate the annual number of visitors from each zone. Your data are shown below. For each zone, the total travel cost 1 euro per person for each kilometer traveled to and from the site. One-Way Distance from Park Origin Total Number of Population Users (in kilometer) A 6.25 125,000 18,750 B 12.5 937,500 93,750 18.75 1,250,000 62,500 b. Suppose a fee were charged to enter the site. What is the per capita demand function for each origin? Please express the relationship in an equation. Calculate the number of visitors and consumer surplus if no fee were C. charged to enter the park.arrow_forwardYou have been commissioned to estimate the demand curve for admission to Lake Saint- Michel, a recreational fishing site in France. To do this, you spend a day surveying visitor to the site. You divide the area around the site into 3 zones. You ask each person you interview where they come from. Based on that information, and figures on annual attendance at the park, you are able to calculate the annual number of visitors from each zone. Your data are shown below. For each zone, the total travel cost 1 euro per person for each kilometer traveled to and from the site. One-Way Distance from Park Origin Total Number of Population Users (in kilometer) A 6.25 125,000 18,750 B 12.5 937,500 93,750 18.75 1,250,000 62,500 а. Express the relationship between per capita visitation rate (R) and travel cost (TC) in an equation. b. Suppose a fee were charged to enter the site. What is the per capita demand function for each origin? Please express the relationship in an equation. Calculate the number…arrow_forwardThe actual and planned data for Broadwater Institute & Technical School for the Fall term were as follows: Enrollment Tuition per credit hour Credit hours cost. Line Item Description Revenue Variable costs: Registration, records, and marketing costs per enrolled student Instructional costs per credit hour Depreciation on classrooms and equipment $1,875,000 Registration, records, and marketing costs vary by the number of enrolled students, while instructional costs vary by the number of credit hours. Depreciation is a fixed Registration, records, and marketing costs $ Instructional costs Total variable costs Amount Contribution margin Depreciation on classrooms and equipment Operating income Actual Prepare a variable costing income statement showing the contribution margin and operating income for the Fall term. Broadwater Institute & Technical School Variable Costing Income Statement For the Fall Term 5,000 $115 $ $ 80,000 $300 $45 Planned 4,500 $100 72,000 $300 $40 $1,875,000arrow_forward
- Please review the rubric prior to beginning the assignment to become familiar with the expectations for successful completion.You are required to submit this assignment to LopesWrite. Please refer to the directions in the Student Success Center.Paul Duncan, financial manager of EduSoft Inc., is facing a dilemma. The firm was founded 5 years ago to provide educational software for the rapidly expanding primary and secondary school markets. Although EduSoft has done well, the firm's founder believes an industry shakeout is imminent. To survive, EduSoft must grab market share now, and this will require a large infusion of new capital.Because he expects earnings to continue rising sharply and looks for the stock price to follow suit, Mr. Duncan does not think it would be wise to issue new common stock at this time. On the other hand, interest rates are currently high by historical standards, and the firm's B rating means that interest payments on a new debt issue would be prohibitive.…arrow_forwardQuestion ENGINEERING ECONOMICS You want to launch a printing services business on campus. The initial cost to get the business running with a September 1st launch date would be $2,000. You estimate that the revenues would approximately offset your costs (e.g. paper, toner, etc.) in the first month of operation so that the monthly profit would be $0. Afterwards, you estimate that profits would increase by $80 each month until the end of the academic year (i.e. $80 profit in October, $160 profit in November, etc. until the end of April). Your annual MARR is 10%, compounded monthly. (a) Calculate the internal rate of return for your investment based on an 8 months study period. Select the appropriate IRR between options 1 to 4 below. (b) Suppose that you now consider another investment opportunity for your printing business services, also with monthly profits, and the internal rate of return of 3%. Is this alternative economically feasible based on IRR?arrow_forwardCourse: Financial Mathematics - Percentage CalculationA group of people is divided into 2 camps: 45% of them in camp A and rest in camp B. If 20% of A is passed to B and then 10% of the amount of B is passed to A. What will be NEW PERCENTAGE of A?Please detail procedure. Thanks :Darrow_forward
- PERFORMANCE TASK NO. 4 Solve the following problems completely. Read and understand the situation below, then answer the question or perform the tasks that follow. 1. A group of college students decided to invest the money they earned from the fund-raising project. After 6 months from today, they want to withdraw from this fund P 10,000.00 quarterly for 1 year to fund for community service. How much is the present total deposit if the interest rate is 4% converted quarterly? 2. A company offers a deferred payment option for the purchase of any furniture. Gladys plans to buy a dining table set with a monthly payment ofP 4,000.00 for 2 years. The payment will start at the end of 3 months. How much is the cash price of the dining set if the company will give 10% compounded monthly?arrow_forwardUse the assumptions below to create calculations to determine annual and monthly revenue projections for each of the categories. Be sure to make the revenue category on the pro-forma view (above) descriptive and use your assumptions as drivers for the values calculated. Make it easy to change the assumptions to determine the impact of a change (up or down) in volume, rates and discounts. Insert lines or columns as needed. Camps and Schools require physicals before kids arrive. There are 150 camper physicals spread evenly in May and June. There are 500 school physicals, 25% in July, 65% in August, and 10% in September. The insurance companies in covering families in your community are split 50% BC/BS and 40% United Healthcare and no insurance (private pay). Your normal camper physical charge is $115. You give BC/BS an 18% discount and United Health care a 15% discount. The special promotion for campers without insurance (private pay) is $75. Camper Physical $ 115 Payor -…arrow_forwardStudy the performance report for Barbaras Bistro in Figure 1-2 of the chapter and write a brief explanation of the strengths and weaknesses of September and year-to-date operations.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Essentials of Business Analytics (MindTap Course ...StatisticsISBN:9781305627734Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. AndersonPublisher:Cengage LearningEssentials Of Business AnalyticsStatisticsISBN:9781285187273Author:Camm, Jeff.Publisher:Cengage Learning,Principles of Cost AccountingAccountingISBN:9781305087408Author:Edward J. Vanderbeck, Maria R. MitchellPublisher:Cengage Learning
Essentials of Business Analytics (MindTap Course ...
Statistics
ISBN:9781305627734
Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson
Publisher:Cengage Learning
Essentials Of Business Analytics
Statistics
ISBN:9781285187273
Author:Camm, Jeff.
Publisher:Cengage Learning,
Principles of Cost Accounting
Accounting
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Cengage Learning