ECONOMICS

Detailed explanation-1: -Economic Batch Quantity is an important point to be determined in industries where costing is employed.

Detailed explanation-2: -Batch Costing is used where articles are produced in batches and held in stock for assembly of components to produce finished products or for sale to customers. Costs are collected against each batch. When the batch is completed cost per unit is computed by dividing total cost by the number of units in each batch.

Detailed explanation-3: -It makes sure that the goods produced meet the level of demand of goods in the market. It will also help to maintain and reduce the quantity of output in inventory. It also helps to minimize the machine set-up/get-up time. The size of the optimum lot also helps to reduce the machine costs.

Detailed explanation-4: -Batch costing is generally applied in manufacturing industry making readymade garments, toy manufacturing industries, tyre and tubes manufacturing companies, pharmaceutical industry, etc.

Detailed explanation-5: -Batch costing is a method used to calculate the cost of producing a batch of products. The key features of batch costing are that it uses a cost per unit of production and allocates overhead costs based on the number of units produced.