COST ACCOUNTING
COST BEHAVIORS
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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at the level of 10, 000 unitsDirect materials = RM 14 000Direct labour = RM 10 000Supervisor’s salary = RM 2000Factory’s repairs = RM 500Depreciation of machine = RM 4000Depreciation of factory = RM 5000Indirect wages = RM 3000Factory’s electric = RM 1500calculate the production cost per unit if the business issues 4000 units
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RM 4000
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RM 26220
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RM 22600
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RM222560
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Explanation:
Detailed explanation-1: -To calculate the overhead rate, divide the indirect costs by the direct costs and multiply by 100. If your overhead rate is 20%, it means the business spends 20% of its revenue on producing a good or providing services. A lower overhead rate indicates efficiency and more profits.
Detailed explanation-2: -Cost of goods sold formula Starting inventory + purchases − ending inventory = cost of goods sold.
Detailed explanation-3: -If the number of taxis owned by a taxi company is the cost object, annual taxi registrations and license fees are examples of variable costs.
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