67. In cost behavior analysis, the linearity assumption states that a. b. c. d. in all cases, there is a strict linear relationship between the cost and cost driver. within the relevant range, there is a strict relationship between the cost and the cost driver. within the relevant range, there is a strict linear relationship between the cost and cost driver. within the relevant range, all costs are fixed and may be drawn graphically as straight lines. 68. Which of the following statements is correct? a. b. c. d. The accounting system is part of cost accounting that measures costs for decision-making and financial reporting purposes. Cost accumulation involves collecting costs by natural classification, such as materials or labor. Cost allocation or cost assignment involves tracing and assigning costs to cost drivers, such as direct labor hours or number of units. Cost and managerial accounting are goods in the economic sense and, as such, their costs must exceed their benefits. 69. Which of the following statements is correct? a. b. c. d. Standard costing is a method that uses predetermined factors, such as quantity and price, to compute the standard cost of the manufacturing cost elements. Standard costing may be used with job-order costing, but not with process costing. Standard costing may be used with process costing, but not with job-order costing. Backflush costing is a cost accounting method that keeps track (in detail) of the flow of cost of work in process. Backflush costing is an accounting method that records costs after a product is sold or a service is completed. It is also known as backflush accounting. 70. Which of the following is not an inventoriable cost under both the absorption and variable costing methods? a. Manufacturing supplies b. Insurance on factory c. Direct labor cost d. Packaging and shipping costs