Costing - Study Mode

[#206] Credit and collection cost is an item of:
Correct Answer

(A) selling overhead

[#207] . . . . . . . . forms part of cost of production.
Correct Answer

(B) Normal waste

[#208] Average cost method of valuing material issues is suitable when . . . . . . . .
Correct Answer

(C) prices fluctuate considerably

[#209] If direct service labour is $7000, idle time wages are $2000 and overtime premium is $950, then total figure would be
Correct Answer

(C) $9,950

Explanation

Solution: Total Overhead = Direct service labour + Idle time wages + Overtime premium = $7000 + $2000 + $950 = $9,950

[#210] Terms used in manufacturing cost systems are
Correct Answer

(D) both B and C

Explanation

Solution: Terms used in manufacturing cost systems are prime costs and conversion costs. Manufacturing cost is the sum of costs of all resources consumed in the process of making a product.