Costing - Study Mode

[#1081] Sunk costs are:
Correct Answer

(B) Not relevant for decision making

Explanation

Solution: Sunk costs are not relevant for decision making. A sunk cost is a cost that cannot be recovered or changed and is independent of any future costs a business may incur. Since decision-making only affects the future course of business, sunk costs should be irrelevant in the decision-making process.

[#1082] The budget that is prepared first of all is . . . . . . . .
Correct Answer

(C) budget for the key factor

[#1083] What is the ideal quick ratio?
Correct Answer

(A) 1 : 1

[#1084] In electricity supply company uses . . . . . . . . as cost unit.
Correct Answer

(A) kilo watt hour

[#1085] Which one of the following is the correct sequence of various stages of operating cycle of a manufacturing company?
Correct Answer

(A) Raw material conversion period, work-in-progress conversion period, Finished goods conversion period, Receivables conversion period