This Method of Estimating Future Costs Can Be Used When

question 46

Multiple Choice

This method of estimating future costs can be used when only one period of data is available.

• A) Scatter plot
• B) High-low method
• C) Analysis at the account level
• D) Regression analysis

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Definitions:

Machine-Hours

A measure of production time, calculated by multiplying the number of machines used by the number of hours they operate.

First Stage Allocations

This involves the assignment of overhead costs to different departments or cost centers as part of the process in activity-based costing.

Overhead Cost

All indirect costs associated with manufacturing or providing a service, not directly traceable to a specific product.

Activity-Based Costing

An accounting method that assigns costs to products and services based on the resources they consume.