COST ACCOUNTING
METHODS OF COSTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Which of the following is a viable option for computing Cost of Goods Sold?
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Gross Margin-Revenue
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Number of Units sold x Unit Cost
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Sum of all expenses in the period
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None of the above.
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Explanation:
Detailed explanation-1: -The COGS formula is: COGS = the starting inventory + purchases – ending inventory.
Detailed explanation-2: -Cost of goods sold (COGS) is calculated by using the COGS formula, which is represented as: (Beginning Inventory + Purchases) – Ending Inventory = COGS.
Detailed explanation-3: -The cost per unit is derived from the variable costs and fixed costs incurred by a production process, divided by the number of units produced.
Detailed explanation-4: -The cost of sales is calculated as beginning inventory + purchases-ending inventory.
There is 1 question to complete.