Costing - Study Mode
[#1131] Cost, which is related to specific cost object and economically traceable, will be classified as
Correct Answer
(A) direct cost
Explanation
Solution: Cost, which is related to specific cost object and economically traceable, will be classified as direct cost. A direct cost is a price that can be completely attributed to the production of specific goods or services.
[#1132] Material or anything for which cost is to be measured is known as
Correct Answer
(B) cost object
Explanation
Solution: Material or anything for which cost is to be measured is known as cost object. A cost object is any item for which costs are being separately measured. It is a key concept used in managing the costs of a business.
[#1133] Cost which is changed in proportion to level total volume is
Correct Answer
(B) variable cost
Explanation
Solution: Cost which is changed in proportion to level total volume is variable cost. Variable costs are costs that change as the quantity of the good or service that a business produces changes.
[#1134] Costs are classified as fixed or variable on basis of
Correct Answer
(D) both a and b
Explanation
Solution: Costs are classified as fixed or variable on basis of specific activity and given time period.
[#1135] Process of tracing direct costs and allocation of indirect costs is known as
Correct Answer
(A) cost assignment
Explanation
Solution: Process of tracing direct costs and allocation of indirect costs is known as cost assignment. Cost assignment is the allocation of costs to the activities or objects that triggered the incurrence of the costs.