In order to evaluate cost information managers must be able to distinguish between relevant costs and irrelevent cost. Explian this statement using an appropriate example.

Q: Define and give examples of the following terms: cost pool, cost object, and cost allocation (or…

A: Responsibility accounting: Responsibility refers to the several concepts and tools used by managers…

Q: Which of the following represent the right process order for cost allocation: Select one: O a.…

A: Cost Allocation is the process of identifying and assigning costs to the various cost objects. These…

Q: Define the following terms: (a) cost behavior and (b) relevant range.

A: Cost behavior and relevant range are terms under cost accounting. Cost behavior studies the pattern…

Q: Describe the uses of cost-plus pricing.

A: Cost plus pricing involves adding a markup to the cost of goods and services to arrive at a selling…

Q: By use of relevant examples, differentiate between the following: a. Relevant costs and Non-relevant…

A: In general words, cost means money that is spent to gain something. In accounting terms, the cost is…

Q: Describe the conference method for estimating a cost function. What are two advantages of this…

A: Conference method:

Q: task order price system, explain the importance of unit cost

A: Task order price system is a system in which performance of tasks are priced based on the value of…

Q: Discuss the disadvantages of Absorption Costing for cost control and performance evaluation.

A: Absorption Costing: Absorption costing is a method for calculating the full cost or total cost of a…

Q: What are the three major ways in which activity-based costing improves the accuracy ofproduct costs?

A: Activity based costing is a system in which costs are allocated to the products on the basis of…

Q: Explain the relationship between the costs of flexible and committed resources, usage of resources,…

A: Cost accounting system: Cost accounting system of an organization consists of procedures and…

Q: relevant and irrelevant cost

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

Q: Explain the advantages of conference method for estimating a cost function.

A: Conference method: Conference method uses, perceptions, analysis, knowledge and related information…

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: Why is it important to keep track of both direct and indirect costs? How do these costs effect…

A: (a )If we keep a tracking record of direct and indirect costs we can determine the firm's…

Q: Explain the features of cost management.

A: Cost management is a process of planning and controlling the costs of a business organisation. This…

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: Explain how the accounting definition of an asset is related to the choice between absorption and…

A: Absorption costing:   Absorption costing is compulsory under Generally Accepted Accounting…

Q: Explain Classifying Costs for Predicting Cost Behavior?

A:

Q: How do strategic factors affect the proper use of relevant cost analysis?

A: Relevant cost analysis is the process of identifying the incremental cost and benefits of deciding…

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: Why is it important to establish appropriate cost pools?

A: Activity cost pools are used in activity based costing which attempts to absorb overheads in a more…

Q: Critically evaluate the concept and application of marginal costing

A: Marginal Costing :— Marginal Costing is the Part of Cost management Techniques.  Marginal Costing…

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: Differentiate between operating costs and administrative costs?

A: Cost accounting is the branch of accounting that inspects the cost structure of a business. This…

Q: How to prepare income statement using absorption costing?

A: Absorption costing considers the fixed overhead costs for production as per the units sold and not…

Q: What criteria might managers use to guide cost-allocation decisions? Which are the dominant…

A: Cost Allocation:The process of assigning the cost to the cost object is cost allocation. The cost…

Q: Describe three criteria for evaluating cost functions and choosing cost drivers.

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

Q: Describe the concepts of contribution margin, relevant range, and relevant costs

A: Solution:- Analysis the concepts of contribution margin, relevant range, and relevant costs as…

Q: Describe factors for measuring cost allocation.

A: Cost:   It is the economic value incurred by the company to manufacture a product or render a…

Q: Which of the following way of cost assignment used to assign accumulated cost with an indirect…

A: Lets understand the basics. Indirect cost are cost which are not directly related to production…

Q: Explain the features of cost accounting.

A: Cost accounting is a branch of accounting in which all the costs involved in manufacturing of a…

Q: Is a standard cost an estimated cost? What is the primary objective of employing standard costs in a…

A: Note: As per our guidelines, only the first question can be answered.   Standard Cost & Its…

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…