Exhibit 81
Use the Information Below for the Following Problem(S)

question 89

Multiple Choice

Exhibit 8.1
Use the Information Below for the Following Problem(S)
$$\begin{array} { c c c } & { \text { Rates of Return } } \\\text { Year } & \text { RA Computer } & \text { Markat Index } \\\hline 1 & 13 & 17 \\2 & 9 & 15 \\3 & - 11 & 6 \\4 & 10 & 8 \\5 & 11 & 10 \\6 & 6 & 12\end{array}$$
-Refer to Exhibit 8.1.The equation of the characteristic line for RA is

• A) R_RA = 11.63 + 1.2195R_MI
• B) R_RA = -7.98 + 1.1023R_MI
• C) R_RA = -9.41 + 1.3893R_MI
• D) R_RA = -4.92 - 0.7715R_MI
• E) R_RA = 4.92 + 0.7715R_MI

---

Definitions:

Absorption Costing

An accounting method that includes all manufacturing costs – direct materials, direct labor, and both variable and fixed manufacturing overhead – in the cost of a product.

Variable Costing

An accounting method that includes only variable costs—costs that vary with production level—in the calculation of unit cost.

Net Incomes

The total earnings of a company after all expenses and taxes have been deducted from total revenue.

Variable Costing

A pricing strategy that incorporates solely the variable costs associated with production—such as direct materials, direct labor, and variable manufacturing overhead—into the cost of goods sold, while omitting fixed overhead expenses.