MULTIPLE CHOICE QUESTION

1. In the cost formula, the term $128,000,000

a. Is the total variable cost.

b. Is the dependent variable.

c. Is the variable rate.

d. Is the total fixed cost.

e. Cannot be determined from the above formula.

The following cost formula was developed by using monthly data for a hospital.

Total Cost = $128,000,000 + ($12,000 × Number of Patient Days)

2. In the cost formula, the term $12,000

a. Is the variable rate.

b. Is the dependent variable.

c. Is the independent variable.

d. Is the intercept.

e. Cannot be determined from the above formula.

The following cost formula was developed by using monthly data for a hospital.

Total Cost = $128,000,000 + ($12,000 × Number of Patient Days)

3. In the cost formula, the term "Number of Patient Days"

a. Is the variable rate.

b. Is the intercept.

c. Is the dependent variable.

d. Is the independent variable.

e. Cannot be determined from the above formula.

The following cost formula was developed by using monthly data for a hospital.

Total Cost = $128,000,000 + ($12,000 × Number of Patient Days)

4. In the cost formula, the term "Total Cost"

a. Is the variable rate.

b. Is the intercept.

c. Is the dependent variable.

d. Is the independent variable.

e. Cannot be determined from the above formula.

The following cost formula was developed by using monthly data for a hospital.

Total Cost = $128,000,000 + ($12,000 × Number of Patient Days)

5. The following cost formula for total purchasing cost in a factory was developed using monthly data.

Total Cost = $235,000 + ($75 × Number of Purchase Orders)

Next month, 8,000 purchase orders are predicted. The total cost predicted for the purchasing department next month

a. Is $8,000.

b. Is $235,000.

c. Is $600,000.

d. Is $835,000.

e. Cannot be determined from the above formula.