Question

Classifying Cost Behavior For each of the following situations, select the most appropriate cost behavior pattern (from the illustrations shown below where the lines represent the cost behavior patter, the vertical axis represents costs, the horizontal axis represents total volume, and the dots represent actual costs. Each pattern may be used more than once. CZ wedding 01)

Answer 1

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Answer-

a) Variable costs per unit Correct Pattern: Pattern No 8 (It reflects the total variable cost at each volume level that can be used to calculate variable cost per unit) b) Total fixed costs Correct Pattern: Pattern No. 8 (It is fixed, and it does not change with the change in production level) c) Total mixed costs Correct Pattern: Pattern No. 11 (It starts with fixed cost only when volume is zero. Then, it grows upward) d) Average fixed costs per unit Correct Pattern: Pattern No. 1 (It is highest when volume is zero and then it comes down with increase in volume.) E) Total current manufacturing costs Correct Pattern: Pattern No. 11 (It starts with fixed cost only when volume is zero. Then, it grows upward) F) Average variable costs Correct Pattern: Pattern No 8 (It reflects the total variable cost at each volume level that can be used to calculate variable cost per unit) g. Total costs when employees are paid $15 per hour for the first 40 hours worked each week and $20 for each additional hour. Pattern No 7 h. Total costs when employees are paid $15 per hour and guaranteed a minimum weekly wage of $300. Pattern No 5 1)Total costs per day when a consultant is paid $200 per hour with a maximum daily fee of $1,000 Pattern No 2

j. Total variable costs Pattern No 3 k. Total costs for salaries of social workers where each social worker can handle a maximum of 25 cases Pattern No 12 L. A water bill where a flat fee of $800 is charged for the first 100,000 gallons and additional water costs $0.005 per gallon Pattern No 5 m. Total variable costs properly used to estimate step costs Pattern No 4 n. Total materials costs Pattern No 3 o. Rent on exhibit space at a convention Pattern No 8