Costing - Study Mode
[#766] Recreation expenses in factory are apportioned on the basis of ________.
Correct Answer
(D) number of employees
Explanation
Solution: Recreation expenses in factory are apportioned on the basis of number of employees. Canteen subsidy or expenses, pension, medical expenses, personnel department expenses, cost of recreational facilities. Expenses of wage department.
[#767] Charging output with overhead at reasonable rate is called ________.
Correct Answer
(C) apportionment
Explanation
Solution: Charging output with overhead at reasonable rate is called apportionment. Distribution of an overhead cost to several departments or cost centers is known as apportionment of overheads.
[#768] Comprehensive machine hour rate includes ________.
Correct Answer
(A) machine operators wages
Explanation
Solution: Comprehensive machine hour rate includes machine operators wages. Composite machine hour rate means the total variable expenses per hour plus the total fixed, constant or standing charges per hour not directly connected with the operation of the machine, but are the general factory overheads of the department.
[#769] In labour oriented manufacturing industry which method of overhead absorption is suitable?
Correct Answer
(C) Labour hour method
Explanation
Solution: In labour oriented manufacturing industry Labour hour method of absorption is suitable. Under this method, direct labour hours are considered for determining the overhead absorption rate. This rate is obtained by dividing the overheads by the total productive hours of workers. This method is suitable for labour intensive industries where manual labour is a dominant factor of production.
[#770] Required rate of return, is multiplied per unit cost of purchased units to calculate
Correct Answer
(B) relevant opportunity cost of capital
Explanation
Solution: Required rate of return, is multiplied per unit cost of purchased units to calculate relevant opportunity cost of capital.