Costing - Study Mode

[#1076] Fixed cost is a cost:
Correct Answer

(C) Which do not change in total during a given period despite changes in output

Explanation

Solution: Fixed cost is a cost which do not change in total during a given period despite changes in output. A fixed cost is a cost that does not change with an increase or decrease in the amount of goods or services produced or sold. Fixed costs are expenses that have to be paid by a company, independent of any specific business activities.

[#1077] Uncontrollable costs are the costs which be influenced by the action of a specified member of an undertaking.
Correct Answer

(A) can not

Explanation

Solution: Uncontrollable costs are the costs which can not be influenced by the action of a specified member of an undertaking. For example: a foreman incharge of a tool room can only control costs pertaining to the same department and the matters which come directly under his control, not the costs apportioned to other department. The expenditure which is controllable by an individual may be uncontrollable by another individual.

[#1078] Element/s of Cost of a product are:
Correct Answer

(D) Material, Labour and expenses

Explanation

Solution: Element/s of Cost of a product are Material, Labour and expenses.

[#1079] Abnormal cost is the cost:
Correct Answer

(B) Cost not normally incurred at a given level of output

Explanation

Solution: Abnormal cost is the cost not normally incurred at a given level of output. These costs are not normally incurred at a given level of output in conditions in which normal levels of output occur.

[#1080] Conversion cost includes cost of converting……… into ……
Correct Answer

(B) Raw material, Finished goods

Explanation

Solution: Conversion cost includes cost of converting Raw material into Finished goods. There are two main components of conversion costs: direct labor and manufacturing overheads.