Describe issues in project cost estimating and how to deal with each.

Q: Develop the link between estimation, budget, variance, project and schedule

A: All these five terms are interlinked and are inter-connected. All these terms important in the…

Q: Discuss the importance of tracking actual and committed costs once a project has commenced.

A: The question is based on the concept of cost control and calculation of cost variance  project…

Q: Explain the implementation issues of the cost estimation methods

A: Cost estimation is the process of determining the probable cost of a product before starting the…

Q: Evaluate labour cost as a major project cost.

A: Project Cost: It is an estimation of total funds required to complete a project. The estimation is…

Q: Give detail definition on operational cost and explain in detail how the operational cost is…

A: Introduction:- The following definition of operational cost as follows under:- Operating costs are…

Q: Should actual or budgeted service department costs be allocated? Why?

A: Service department:   A service department is a division in an organization that is not involved…

Q: Classify the following cost drivers as structural, executional, or operational.

A: Classification of cost derives: Classification 0f the given cost drivers as structural, executional,…

Q: In developing an ABC system, what is the last step? Identify the primary activities and estimate a…

A: The question is based on the concept of Cost Accounting.

Q: Define Cost effectiveness.

A: Cost effectiveness refers to the examination of both cost and health outcomes of different course of…

Q: The budgeted cost for all activities in a project with the help of earned value method is defined…

A: Budgeted cost: It implies to the estimated cost that is computed based on the estimation including…

Q: Explain what a sunk cost is, what an opportunity cost is, and how each cost should be handled when…

A: The question is based on the concept of cost analysis.

Q: Write cost pool, cost driver, activity cost, budgeting.   What are the assumption of CVP analysis?…

A: Answer:  Write cost pool, cost driver, activity cost, budgeting.   Cost Pool is the sum total of…

Q: The process of creating a formal plan and translating goals into quantitative form is Process…

A: The process of creating a formal plan and translating goals into quantitative forms is known as…

Q: Which type of cost center has a planning focus, and which type has an evaluation focus?

A: Cost Center: It is a department within an organization to which costs can be assigned.

Q: Pre-determined costs are future costs which are ascertained in advance of production on the basis of…

A: Cost accounting is the accounting of the cost incurred during the accounting period. This helps the…

Q: Define the following terms, and explain the relationship between them: (a) cost estimation, (b) cost…

A: Cost:   Cost can be defined as the cash and cash equivalent which is incurred against the products…

Q: Explain the difference between the engineered-cost and discretionary-cost approaches to…

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

Q: How flexible budget through performance reporting is help for the management in determination of…

A: Budgeting refers to preparation of  estimated financial data using the past records. Flexible budget…

Q: How are joint costs allocated? Explain and analyze using numerical example.

A: Joint Costs In business different costs are incurred in the production process, but in certain…

Q: What is the difference between a structural cost driver and an executional cost driver? Provide…

A: Cost driver: cost driver is a particular unit or specific activity that is responsible for a change…

Q: Identify the output and input variables in both the bottom-up and top-down strategies to cost…

A: Bottom ups of the cost estimate are the most accurate cost estimation process wherein every minute…

Q: Define standard costs and briefly indicate how they may beused by management in planning and…

A: Standard costs: Standard costs are the per-unit cost that is expected to be incurred under normal…

Q: Describe the process of project budgeting.

A: Budget is the summary statement of expected expenses and income for a particular period of time.…

Q: Cost Management is extremely important for running successful projects. With reference to this:…

A: Project Cost: It refers to the total funds that are required to complete a project.

Q: Explain Calculating Total P System Costs?

A: Periodic inventory system also known as P system is a method of stock taking, where stock taking is…

Q: Describe the procedure to compute the variance of return for a project?

A: Variance is ascertained as follows: The mean worth is dictated by including all the information…

Q: Discuss the techniques that can be applied to obtain relevant and accurate cost estimates.

A: The question is based on the concept of cost estimation, which is one the most important parameter…

Q: Once standard costs are established, what conditions wouldrequire that standards be revised?

A: Standard costs: Standard costs are the per-unit cost that is expected to be incurred under normal…

Q: Explain the difference between resource spending and resource usage.

A: Resources: Resources are the economic elements that enable people to carry out activities. A…

Q: Identify and discuss the factors that affect the focus and practice of cost management.

A: The practice of managing and organizing the expenses associated with running a firm is known as cost…

Q: How would merging of two systems affect the costing of the new system including the impact on…

A: The act of distinguishing, investigating, , measuring, interpreting, and conveying the monetary data…

Q: Define research and development and what are its representative cost driver?

A: Cost drivers: It refers to the object or things which affect the costs of a business. For example,…

Q: How do you create a project budget?

A: A budget is a financial representation of the estimated future incomes and expenses. There are…

Q: Question 4 Good cost planning requires a basic understanding of how organizations account for…

A: Answer:- 4 Characterization of cost components:-  1. Materials:- The cost of the materials needed to…

Q: Analyse the significance of gearing and insolvency for project cost   2. Evaluate labour cost as a…

A: SOLUTION-1 GEARING- IT REFERS TO A RELATIONSHIP OR RATIO OF COMPANY DEBT AND EQUITY . GEARING SHOW…

Q: Describe the term target costing.

A: Target costing: Target costing is a business procedure that targets at the earliest stages of new…

Q: Compute for the joint cost allocated to Reta.

A: Joint costs are those costs that are incurred for two or more than two products simultaneously.…

Q: Why is target costing most effectively applied at the researchand development and production process…

A:

Q: Explain the strategic role of cost estimation.

A: Cost estimation: Cost estimation is a technique that assist the management for taking strategic…

Q: Explain the implementation problems in cost estimation.

A: Cost estimation: It is the development of a defined relationship between cost object and cost…

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.