1. Distinguish between a) variable cost, b) a fixed cost, c) a mixed cost.

2. What effect does an increase in volume have on

a.unit fixed cost

b. unit variable cost

c. total fixed cost

d. total variable cost

3.Define the following terms: a) cost behavior and b) relevant range.

4.What is meant by an activity-based when dealing with variable cost? give several examples of activity bases.

5. Distinguish a) a variable cost, b) a mixed cost, c) a step variable cost. plot the three costs on a graph with activity plotted horizontally and cost plotted vertically.

6.Managers often assume a strictly linear relationship between cost and volume. How can this practice be defended in light of the fact that many costs are curvilinear?

7.Distinguish between discretionary fixed cost and committed fixed costs.

8.Classify the following fixed costs as normally being and they're committed or discretionary:

a.Depreciation on buildings

b.Advertising

c. Research

d.Long-term equipment leases

e.Pension payments to the company's retirees

f.Management development and training

9.Does the concept of the relevant range apply to fixed costs? Explain.

10.What is the major disadvantage of the high-low method?

11.Give the general formula for mixed cost. which term represents the variable cost? the fix cost?

12.What is meant by the term least-squares regression?

13.What is the difference between ordinary least squares regression analysis and multiple regression analysis?

14.What is the difference between a contribution approach income statement and a traditional approach income statement?

15.What is a contribution margin?