Which cost behaviour method may use time and motion studies to determine the activities and amounts for cost behaviour analysis?
A)account analysis method
B)industrial engineering method
C)regression analysis
D)high-low method

Question

Quizplus · Accepted Answer

The industrial engineering method involves time and motion studies to determine the activities and amounts for cost behaviour analysis. This method is based on the assumption that the cost is a function of the amount of time spent on an activity. Therefore, it is the best choice for this scenario. The account analysis method involves a review of accounts in the general ledger to identify costs that are variable, fixed or mixed. The regression analysis and high-low method are statistical techniques used to estimate a cost function but do not involve time and motion studies.

Which Cost Behaviour Method May Use Time and Motion Studies