An important application of regression analysis in accounting is in the estimation of cost. By collecting data on volume and cost and using the least squares method to develop an estimated regression equation relating volume and cost, an accountant can estimate the cost associated with a particular manufacturing volume. Consider the following sample of production volumes and total cost data for a manufacturing operation.

(a)

Use these data to develop an estimated regression equation that could be used to predict the total cost for a given production volume. (Round your numerical values to two decimal places.)

ŷ = _____

(b)

What is the variable cost (in dollars) per unit produced?

$ _____

(c)

Compute the coefficient of determination. (Round your answer to three decimal places.)

What percentage of the variation in total cost can be explained by production volume? (Round your answer to one decimal place.)

________%

(d)

The company's production schedule shows 650 units must be produced next month. Predict the total cost (in dollars) for this operation. (Round your answer to the nearest cent.)

$ _______

You plan to buy a house in 24 months. The cost of the house at that time will be $300,000 . How much do you have to invest each month, starting next month, for 12 months to exactly pay for the house if you r investments earn 4.50% APR (compounded monthly)?

19A. Which of the following is not a benefit of Managerial Accounting?

A. Provides the cost of manufacturing a product

B. Produces financial statements for external parties

C. Analyzes potential efficiencies from automation

D. Analyzes how many units need to be sold to cover expenses

19B

The type of Managerial Accounting that focuses on social and environmental impacts is known as:

A. Profitability

B. Sustainability

C. Solvency

D. Liquidity

- Which of the following is an implicit cost of production?

a) the interest you pay your mother for the money she loaned you to start your business

b) the loss in the value of capital equipment due to wear and tear

c) the utility bill paid to water, electricity, and natural gas companies

d) the salary you pay yourself for running your business

- The minimum efficient scale is

a) the plant size that yields the most profit.

b) the smallest output level where the firm finally reaches productive efficiency.

c) the level of output where diminishing returns have not set in yet.

d) the smallest level of operation where long-run average costs are lowest.

- Which of the following statements is true?

a) Total cost = fixed cost + variable cost.

b) Total cost = fixed cost + implicit cost.

c) Variable cost = wages + salaries + benefits.

d) Opportunity cost = explicit cost - implicit cost.

​(Individual or component costs of​ capital)  Compute the cost of capital for the firm for the​ following:

a.  A bond that has a​$1,000par value​ (face value) and a contract or coupon interest rate of11.8percent. Interest payments are​$59.00and are paid semiannually. The bonds have a current market value of​$1124,and will mature in10years. The​ firm's marginal tax rate is34percet.b.  A new common stock issue that paid a​$1.79 dividend last year. The​ firm's dividends are expected to continue to grow at7.3 percent per​ year, forever. The price of the​ firm's common stock is now​$27.97 c.  A preferred stock that sells for​$132 pays a dividend of 9.2 ​percent, and has a​ $100 par value.  d.  A bond selling to yield11.4percent where the​ firm's tax rate is34percent.

a.  The​ after-tax cost of debt isnothing​%.​(Round to two decimal​ places.)

Bill Gates is analyzing a proposed expansion of a division in Switzerland. The cost of the expansion would be SF 16 million. The cash flows associated with the project would be SF 4.2 million per year for the next 5 years. The dollar required return is 12 percent per year, and the current exchange rate is SF 1.07. The interest rate in the U.S. is 5 percent per year. The interest rate in Switzerland is 2 percent per year. Use the approximate form of interest rate parity in calculating the expected spot rates. a. Convert the projected franc flows into dollar flows and calculate the NPV. (Do not round intermediate calculations and enter your answer in dollars, not in millions, rounded to two decimal places, e.g., 1,234,567.89) b-1. What is the required return on franc flows? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b-2. What is the NPV of the project in Swiss francs? (Do not round intermediate calculations and enter your answer in francs, not in millions, rounded to two decimal places, e.g., 1,234,567.89) b-3. What is the NPV in dollars if you convert the franc NPV to dollars? (Do not round intermediate calculations and enter your answer in dollars, not in millions, rounded to two decimal places, e.g., 1,234,567.89)

how do you find the lower cost market value

Describe the impact of corporate taxes on the weighted average cost of capital.

The price of a product in a competitive market is $200. If the cost per unit of producing the product is 80 + 0.1x dollars, where x is the number of units produced per month, how many units should the firm produce and sell to maximize its profit?

Tinto Company is planning to invest in a project at a cost of $135,000. This project has the following expected cash flows over its three-year life: Year 1, $45,000; Year 2, $52,000; and Year 3, $78,000. Management requires a 10% rate of return on its investments. Compute the net present value of this investment. Use PV tables that are in a separate file or see Appendix B of your textbook.

PV table:

1 .... 0.8696

2 .... 0.7561

3 .... 0.6575