Which one is correct?Rent, lighting and supervision cost are common costs.‘Joint Costs’ cannot be apportioned only by adopting a basis of apportionmentCost ascertainment does not involve allocation and apportionment of the expenditure to the cost centres. Production cost does not include the cost of the primary packing of the productNone of the above/More than one of the above.
Question
Which one is correct?Rent, lighting and supervision cost are common costs.‘Joint Costs’ cannot be apportioned only by adopting a basis of apportionmentCost ascertainment does not involve allocation and apportionment of the expenditure to the cost centres. Production cost does not include the cost of the primary packing of the productNone of the above/More than one of the above.
Solution
To determine which statement is correct, let's analyze each statement one by one:
-
"Rent, lighting, and supervision cost are common costs." This statement is correct. Common costs are expenses that cannot be directly attributed to a specific cost center or product. Rent, lighting, and supervision costs are typically shared among different departments or activities within a company.
-
"‘Joint Costs’ cannot be apportioned only by adopting a basis of apportionment." This statement is incorrect. Joint costs refer to costs incurred in the production of multiple products or services that cannot be easily separated. These costs can be apportioned among the different products or services based on a suitable basis of apportionment, such as sales value or physical units.
-
"Cost ascertainment does not involve allocation and apportionment of the expenditure to the cost centers." This statement is incorrect. Cost ascertainment involves the process of identifying and allocating costs to specific cost centers or activities within a company. It includes the allocation and apportionment of expenditures to determine the cost of producing goods or providing services.
-
"Production cost does not include the cost of the primary packing of the product." This statement is correct. Production costs typically include direct materials, direct labor, and manufacturing overhead costs directly associated with the production process. The cost of primary packing, such as packaging materials, would be considered a separate cost and not included in the production cost.
Based on the analysis, the correct statement is: "Rent, lighting, and supervision cost are common costs."
Similar Questions
Which statement is TRUE? Group of answer choicesA normal costing cannot be used jointly with a job costing system.A process costing system is more appropriate for service industries than a job costing system.A job costing system assigns direct material costs to products in the same manner as a process costing system does.A job costing system allocates direct costs to products; a process costing system does not assign direct costs to products.A normal costing cannot be used jointly with a process costing system.
The following statements are correct excerpt? A. Both direct and indirect costs are exclusively traced to cost object in the same way B. Cost allocation occurs when quantity of resources consumed by a particular cost object cannot be directly measured C. Different costs are used for different purposes D. Costing systems vary depending on the level of sophistication for cost assignment
Which of the following indirect costs can be included as a product cost under activity-based costing but should not be included as a product cost according to GAAP?
Which of the following statements about cost allocation is incorrect? a. Step-down method does not fully recognise the mutual dependenciesbetween support departments B.To ensure fairness, the same cost driver should be used to allocate costsfor all indirect cost pools. c. A cost may be considered an indirect cost even if it has a one-on-onerelation to the cost object, because the benefit of tracing this cost is toosmall. D. A cost can be direct or indirect cost depending on the cost object ofinterest. E. A training program offered by the human resource department can be a cost object.
Which statement is TRUE?Group of answer choicesActivity-Based Costing can only be used jointly with normal costing.Activity-Based Costing can improve the accuracy of product cost under a Job Costing setting more than under a Process Costing settingJob costing cannot be applied jointly with Activity-Based Costing.Process costing cannot be applied jointly with Job Costing.Activity-Based Costing can improve the accuracy of product cost under a Process Costing setting more than under a Job Costing setting.
Upgrade your grade with Knowee
Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.