Costing - Study Mode
[#511] If an average inventory is 2000 units, annual relevant carrying cost of each unit is $5, then annual relevant carrying cost will be
Correct Answer
(A) $5,000
[#512] If demand of one year is 25000 units, relevant ordering cost for each purchase order is $210, carrying cost of one unit of stock is $25 then economic order quantity will be
Correct Answer
(B) 648 packages
[#513] Cost of product failure, error prevention and appraisals can be classified under
Correct Answer
(C) costs of quality
Explanation
Solution: Cost of product failure, error prevention and appraisals can be classified under costs of quality. Cost of quality (COQ) is defined as a methodology that allows an organization to determine the extent to which its resources are used for activities that prevent poor quality, that appraise the quality of the organization's products or services, and that result from internal and external failures.
[#514] Activities related to coordinating, controlling and planning flow of inventory are classified as
Correct Answer
(C) inventory management
Explanation
Solution: Activities related to coordinating, controlling and planning flow of inventory are classified as inventory management. Inventory management refers to the process of ordering, storing, and using a company's inventory. These include the management of raw materials, components, and finished products, as well as warehousing and processing such items.
[#515] Basis of apportionment of welfare department expenses is . . . . . . . .
Correct Answer
(B) number of employees