Costing - Study Mode
[#736] Costing system, which is a combination of process costing and job costing system is classified as
Correct Answer
(C) hybrid costing system
Explanation
Solution: Costing system, which is a combination of process costing and job costing system is classified as hybrid costing system. Hybrid costing is used to separate costs and allocate costs to individual products or groups of products.
[#737] First step in constant gross margin percentage NRV method is to allocate joint to compute
Correct Answer
(A) Gross margin percentage
Explanation
Solution: First step in constant gross margin percentage NRV method is to allocate joint to compute Gross margin percentage. Gross margin is the difference between revenue and cost of goods sold divided by revenue. Gross margin is expressed as a percentage.
[#738] An additional cost, incurred for some specific activity to bring processed product on to next production stage is
Correct Answer
(C) incremental cost
Explanation
Solution: An additional cost, incurred for some specific activity to bring processed product on to next production stage is incremental cost. Incremental cost also referred to as marginal cost, is the total change a company experiences within its balance sheet or income statement due to the production and sale of an additional unit of product.
[#739] A joint cost allocation method is based on relative value of total sales, at point of split off is classified as
Correct Answer
(A) sales value at split off method
Explanation
Solution: A joint cost allocation method is based on relative value of total sales, at point of split off is classified as sales value at split off method. The split-off point is the point at which joint production stops and processing for separate products begins.
[#740] In activity based costing system, description of activity can be classified as
Correct Answer
(D) both a and b
Explanation
Solution: In activity based costing system, description of activity can be classified as activity list and activity dictionary.