Costing - Study Mode
[#46] Higher level of production leads to
Correct Answer
(A) higher repair cost
Explanation
Solution: Higher level of production leads to higher repair cost.
[#47] Method of estimation of cost function, by making opinions and analysis about cost and cost drivers is classified as
Correct Answer
(A) conference method
Explanation
Solution: Method of estimation of cost function, by making opinions and analysis about cost and cost drivers is classified as conference method. The conference method is an approach to cost estimation that pools together data, analyses, and knowledge from expert sources in order to make decisions about costs.
[#48] Within relevant range, cost function which cost does not change in narrow ranges of activity is called
Correct Answer
(C) step variable cost function
Explanation
Solution: Within relevant range, cost function which cost does not change in narrow ranges of activity is called step variable cost function. A step variable cost is a cost that generally varies with the level of activity, but which tends to be incurred at certain discrete points and to involve large changes in amounts when such a point is reached.
[#49] In linear cost function which is y=a + bx, objective is to find the
Correct Answer
(A) values of a and b
Explanation
Solution: In linear cost function which is y=a + bx, objective is to find the values of a and b.
[#50] Variable cost increases with . . . . . . . . in output.
Correct Answer
(A) increase