When Using the Visual-Fit Method to Estimate a Cost Function,we

question 130

Multiple Choice

When using the visual-fit method to estimate a cost function,we can estimate the fixed cost by ________.

• A) the point where the sketched line (through all or most of the data points) intersects the x-axis
• B) the point where the sketched line (through all or most of the data points) intersects the y-axis
• C) calculating the variable cost per unit of the cost driver
• D) subtracting the variable cost at any cost driver level from the total cost

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Definitions:

Present Value

The present financial value of a sum of money to be received in the future or a series of cash flows, considering a specific return rate.

Annual Dividend

A payment made by a corporation to its shareholders, usually as a distribution of profits on a per-share basis each year.

Dividend Growth Model

A model that estimates the value of a company's stock based on its expected future dividends and their growth rate.

Market Rate

The market rate, often referred to as the going rate, is the standard or average interest rate, wage, or price charged or paid for a specific good, service, or asset in a specific market.