COST ACCOUNTING
COST MANAGEMENT SYSTEMS
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
Identify two ways that standard cost is calculated. (Choose two.)
|
|
Users must manually enter the cost of each configured item; the calculation is not automated.
|
|
|
The standard cost of the configured item is based on the purchase order price quoted by the supplier for the configured item.
|
|
|
The roll-up calculation can be performed to update standard costs for Cost Accounting purposes.
|
|
|
The standard cost is the sum of the cost of the selected option items.
|
|
|
The cost of a configured item is calculated based on the work definition of the model item.
|
Explanation:
Detailed explanation-1: -According to the formula, the product’s standard cost is calculated by adding the value of the direct material costs, the value of the direct labor costs, the value of the total variable overheads, and the value of the total fixed overheads during the period.
Detailed explanation-2: -The standard cost rollup helps maintain accurate costing data for assembly items by calculating the standard cost of assemblies. The cost of an assembly is determined based on current costs of member components. The cost rollup process calculates the fixed cost based on data entered on the planned standard cost record.
There is 1 question to complete.