Which ONE of the following statements concerning costing is correct? a) The procedures used to calculate unit costs in manufacturing industries are not applicable to service industries. b) Within process costing the cost per unit of output is found indirectly by dividing total costs by the number of units produced. c) In process and job costing the cost per unit of output is found directly by accumulating costs for each unit. d) Costing is irrelevant because the same level of detailed information can be extracted from the financial accounts.
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Which ONE of the following statements concerning costing is correct?
a) The procedures used to calculate unit costs in manufacturing industries are not
applicable to service industries.
b) Within
total costs by the number of units produced.
c) In process and
accumulating costs for each unit.
d) Costing is irrelevant because the same level of detailed information can be
extracted from the financial accounts.
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