2. Give an example of cost which is a part of unavoidable cost.

Q: Describe and apply the lower-of-cost-or-net realizable value rule.

A:

Q: Explain difference between prime costs and conversion costs.

A: Prime cost: It is the cost which is incurred for manufacturing a product. It includes direct…

Q: what is an indirect cost and how is it different than a direct cost?

A: Indirect Cost: Indirect costs are the costs of doing business that are not easily identified with a…

Q: Understand thedifferences between directand indirect costs

A: Cost:   It refers to the economic value incurred by an organization for manufacturing a product or…

Q: relevant costs are always: a.variable costs b.avoidable costs c.sunk costs d.fixed costs

A: Relevant costs are the cost that describes the avoidable costs that are incurred for making specific…

Q: Does the concept of the relevant range apply to fixed costs? Explain.

A: Fixed Cost: It is a cost which is constant in the short run, it is not related to any change in the…

Q: What are the advantages and disadvantages of cost principle

A: Cost principle is an accounting principle that recognizes the asset at their respective cash amounts…

Q: In a special order situation, any fixed cost associated with the order is irrelevant cost. True…

A: This question deals with the concept of relevant costing. In special order situation, generally all…

Q: Understand and apply the lower-of-cost-or-net realizable value rule.

A:

Q: Give an example of cost which is a part of unavoidable cost.

A: Unavoidable costs are costs which cannot be avoided by discontinuing a product line or which cannot…

Q: Why is it necessary to distinguish between variable and fixed costs when dealing with mixed costs

A: Introduction:- Every Business expenses are classified as either fixed or variable costs. on other…

Q: relevant and irrelevant cost

A: Relevant and irrelevant costs are categories of costs based on their effect on decision making.

Q: Define the term avoidable cost.

A: Cost: The amount paid to purchase the asset, install it, and put it into operations, is referred to…

Q: Giving examples, distinguish between Prime costs and Marginal costs

A: Prime costs are the firm total expenses directly related to the materials and labour used in…

Q: Define the term Cost approaches.

A: Cost: The amount paid to purchase the asset, install it, and put it into operations, is referred to…

Q: Direct costs can be referred to as fixed costs. True or False?

A: Cost are divided into two parts which are, (1) Direct cost (2) Indirect cost Direct costs are the…

Q: a) Why are neutral expenes eliminated and imputed cost added to derivee cost from expenses

A: Deriving the cost from expenses is necessary to ascertain the exact cost incurred and to…

Q: What two assumptions are frequently made when estimating a cost function?

A: Cost Function:Cost function represents the basic change that occurs in the total cost due to the…

Q: What is the definition of cost?

A: In the business, costs are the important measures to determine the value of elements being purchased…

Q: Explain the difference between a controllable and a noncontrollable cost.

A: Cost: The amount paid to purchase the asset, install it, and put it into operations, is referred to…

Q: What is the difference between total costs and marginal costs?

A: Total cost is the total economic cost of production. Variable cost changes according to the quantity…

Q: What circumstances might create distortions where estimated costs are not an accurate representation…

A: The estimated costs are the costs determined through the estimation process on past…

Q: What are: Relevant / irrelevant / Differential Costs Relevant / irrelevant / Differential Revenues…

A: Relevant / Irrelevant / Differential Costs: Relevant Costs are the cost which are relevant in…

Q: What is cost approach measurement?

A: A process that involves finding out the economic value or the fair value of a business entity refers…

Q: The cost that is used for the benefit of many cost objects and cannot be easily related to any…

A: Answer is as follows

Q: What are “initial direct costs” and how are they accountedfor?

A:

Q: 1) What is the assumption of cost structure? 2) Calculate contribution Margin

A: A company's overall expenses are comprised of both fixed and variable costs, and together they make…

Q: What is fixed cost

A: The answer is as fallows

Q: Describe the difference between prime costs and conversion costs?

A: Solution:-  Difference between prime costs and conversion costs as follows under:-

Q: What is total cost?

A: The answer is explained as follows:

Q: example of lower of cost or net realizable value and explain

A: The concept of lower of cost or net realizable value says that the amount of inventory should be…

Q: explain the importance of cost behavior

A: Cost behavior refers to any change in the behavior of cost due to change in the level of output or…

Q: What are sunk costs? Give an example.

A:

Q: 1. What are the key cost categories in the traditional view?

A: Traditional view is the type of costing wherein the allocation of factory overheads is done based on…

Q: A cost that cannot be changed because it arises from a past decision and is irrelevant to future…

A: Definition:

Q: The following statements are correct excerpt? OA. Only avoidable costs are relevant for decision…

A: Relevant costs are costs which are important for decision making or these costs can effect the…

Q: What is a relevant cost?

A:

Q: Consider the following statements concerning costs.        1. A committed cost cannot vary with the…

A: Committed costs are costs that are committed or fixed to be incurred in future period of time.…

Q: Why is cost important?

A: Cost - it means expenses incurred by an organisation to make an product whether it is direct cost or…

Q: Which one of the following may not be considered a cost driver?

A: Under activity based costing, activities and cost allocation basis (cost drivers) are used to…

Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.