You Are Trying to Decide Whether to Use Machine Hours

question 65

Multiple Choice

You are trying to decide whether to use machine hours or direct labor hours as the best predictor for overhead costs.Below are the results from the two regression analyses that you run.

Which of the following statements is the most correct regarding which activity would be the best cost driver and why?

• A)Direct labor hours because the variable explains 76% of the variance in overhead costs.
• B)Machine hours because the variable explains 78% (100 - 22%)of the variance in overhead costs.
• C)Machine hours because only 22% of the variance in overhead costs is not explained in the analysis.
• D)Direct labor hours because this activity is perfectly correlated with overhead costs.
• E)None of the answer choices is correct.

Understand the legal standards for reliance on statements and representations during contractual agreements.

Identify and compare different defenses available for contract rescission.

Describe the significance of material facts in the context of contract law.

Understand the principles of mistake of value versus mistake of fact in contract disputes.

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Definitions:

Social Facilitation

The tendency for individuals to perform differently when in the presence of others than when alone, typically showing improved performance on simple or well-learned tasks.

Power Distance

A cultural dimension that measures the extent to which less powerful members of society accept and expect that power is distributed unequally.

Hierarchy

A system or organization in which people or groups are ranked one above the other according to status or authority.

Committed

The state of being dedicated or devoted to a cause, activity, or goal, typically implying a long-term engagement or obligation.