Question 1

The total cost of an item is the sum of:

Accepted Answer

A) both its direct and indirect costs 
B) direct costs,indirect costs and manufacturing overhead 
C) total indirect costs divided by number of units 
D) none of the options is correct 
A) both its direct and indirect costs 
B) direct costs,indirect costs and manufacturing overhead 
C) total indirect costs divided by number of units 
D) none of the options is correct

Question 2

The main volume related driver of indirect costs in a highly mechanised operation is most likely to be:

Accepted Answer

A) direct labour dollars. 
B) direct labour hours. 
C) machine maintenance dollars. 
D) machine hours. 
A) direct labour dollars. 
B) direct labour hours. 
C) machine maintenance dollars. 
D) machine hours.

Question 3

Assume Air Tec manufactures only one component for the air conditioning industry.In 2013 the company produced 12 000 units of the component of which 10 000 were sold.The following costs were recorded for 2013:
$\begin{array}{llcc}
  &\text { \$ }\
  \text { Direct material} &500000  \
 \text {Direct labour  } &150000\
 \text { Manufacturing overhead } &220000\
 \text { Administrative expenses } &  97000\
\end{array}$

If there were 1000 units in beginning inventory,calculate the cost of sales for Air Tec for 2013.

Accepted Answer

A) $72 500 
B) $145 000 
C) $217 500 
D) $725 000 
A) $72 500 
B) $145 000 
C) $217 500 
D) $725 000

The total cost of an item is the sum of:

The main volume related driver of indirect costs in a highly mechanised operation is most likely to be:

Introduction to Accounting

Business Sustainability

Business Structures

Business Transactions

Balance Sheet

Income Statement and Statement of Changes in Equity

Statement of Cash Flows

Analysis and Interpretation of Financial Statements

Budgeting

Cost-Volume-Profit Analysis

Capital Investment

Financing the Business

Performance Measurement

Filters

Exam 11: Costing and Pricing in an Entity

The total cost of an item is the sum of:

The main volume related driver of indirect costs in a highly mechanised operation is most likely to be:

Introduction to Accounting

Business Sustainability

Business Structures

Business Transactions

Balance Sheet

Income Statement and Statement of Changes in Equity

Statement of Cash Flows

Analysis and Interpretation of Financial Statements

Budgeting

Cost-Volume-Profit Analysis

Capital Investment

Financing the Business

Performance Measurement

Filters