# Cost and management accounting

Question No Variable Cost Fixed Cost Mixed Cost The cost of materials used to build a desk  Rent paid on a factory building  The flat fee paid for a copier plus the per-copy charge
The cost of hourly workers in a Laundromat
Depreciation on a factory equipment

The paycheck of a worker paid on commission alone
The salary of the factory supervisor

The cost of electricity used to run the air conditioning unit

Question No. 2
(a)
Month
Machine Hours
Electricity Cost
January
2, 000
18, 900
February
2, 400
21, 500
March
1, 400
14, 000
April
2, 600
23, 500
May
3, 300
28, 750
June
3, 300
22, 700
July
3, 600
25, 250
August
3, 000
23, 250
September
1, 500
16, 000
October
3, 300
26, 500
November
4, 200
31, 500
The cost function can be calculated through the linear regression analysis. The result of the regression analysis is as follows
Regression Statistics
Multiple R
0. 943848087
R Square
0. 890849211
0. 878721346
Standard Error
1816. 144951
Observations
11

Coefficients
Intercept
7, 466. 86
X Variable 1
5. 55
Thus the cost function for the given equation is
Total Cost = 7. 466. 86 + (number of hours) x 5. 55
(b)
Expected Production
40, 000
Variable Cost
221, 849
Fixed Cost
7, 467
Total Cost
229, 316
(c)
Question Number 3
Material Variance

Price Variance
Actual Quantity
Standard Price
Actual Price

105, 000. 00
3. 00
2. 70

Difference in Price
0. 30

Variance
31, 500. 00

Favorable

Quantity Variance
Standard Price
Actual Quantity
Standard Quantity Allowed

3. 00
105, 000. 00
100, 000. 00

Difference in quantity
5, 000. 00

Variance
15, 000. 00

Labor Variance

Rate Variance
Actual hours worked
Standard rate
Actual rate

76, 000. 00
8. 00
8. 25

Difference in rate
0. 25

Variance
19, 000. 00

Efficiency Variance
Standard rate
Actual hours worked
Standard hours Allowed

8. 00
76, 000. 00
75, 000. 00

Difference in hours
1, 000. 00

Variance
8, 000. 00