C Ethical guidance provides a set of
principles which can be applied at the
discretion of the accountant. Relevant range is the band of the level of activity or volume in which a specific relationship between the level of activity or volume and the cost in question is valid. Costs are described as variable or fixed with respect to a particular relevant range. Conversion costs are all manufacturing costs other than direct materials cost. A variable cost is a cost that does change in total in proportion to changes in a cost driver.
Service companies provide services or intangible products to their customers. The operating-cost line items for service companies will include costs from all areas of the value chain.Merchandising-sector companies purchase and sell products without changing their basic form. “Cost of goods sold” is often the most significant cost category. https://accounting-services.net/bookkeeping-surprise/ Merchandise purchased from suppliers but not sold at the end of an accounting period is held as stockManufacturing companies purchase materials and components and convert them into finished goods. Materials and labour costs is often the most significant cost category. Stock can include direct materials, work in progress or finished goods.
Chapter 2: An Introduction to Cost Terms and Purposes Flashcards Preview
A fixed cost is a cost that does not change in total despite changes in the cost driver. Indirect costs are related to the particular cost object but cannot be traced to it in an economically feasible way. 2.2 Define direct and indirect costs and give an example of each. Direct materials cost are the acquisition costs of all materials that eventually become part of the cost object. Purchase costs include inward delivery charges, VAT and other customs duties. All manufacturing costs that are related to the cost object (work in process and then finished goods) but that cannot be traced to that cost object in an economically feasible way.
Use these revision flashcards to support your preparation for mocks, other assessments and the final Edexcel A-Level Politics exams. These superb packs of revision flashcards contain everything you need to cover for AQA & Edexcel A Level Economics. For contracting with government agencies, there are often detailed guidelines on what is allowed to be included in a product-cost amount. 2.4 Give three factors that will affect the classification of a cost as direct or indirect. This resource-packed course provides the complete online support package for A-Level Economics teachers delivering lessons on externalities.
CHEGG PRODUCTS AND SERVICES
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- 2.7 Explain why unit costs must often be interpreted with caution.
- Unit costs of a cost object should be interpreted with caution when they include a fixed-cost component.
- Tutor2u’s series of cost-effective and specification-focused workbooks for GCSE and A-Level are essential teaching and revision aids throughout each course.
- A variable cost is a cost that does change in total in proportion to changes in a cost driver.
- It could also be a Brand category, an Activity, a Department or a Programme.
- Conversion costs are all manufacturing costs other than direct materials cost.
A cost object is anything for which a separate measurement of costs is desired. It could be a product, a service, or even a project or a customer. It could also be a Brand category, an Activity, a Department or a Programme. For product pricing and product emphasis (product pricing and Chapter 2: An Introduction to Cost Terms and Purposes Flashcards product-mix decisions) all costs of those areas of the value chain required to bring a product to a customer should be included. The direct/indirect classification depends on the choice of the cost object! I.e. what could be a direct cost for one cost object is not for another.
Chapter 1 : Introduction to accounting – question
A manufacturing company must also develop, design, market and distribute its products. For financial statements, the focus is on inventoriable costs. In most countries, generally accepted accounting principles in manufacturing companies allow only manufacturing costs to be assigned to products reported in financial statements.
- When making total cost estimates, think of variable costs as an amount per unit and fixed costs as a total amount.
- Merchandise purchased from suppliers but not sold at the end of an accounting period is held as stockManufacturing companies purchase materials and components and convert them into finished goods.
- C Ethical guidance provides a set of
principles which can be applied at the
discretion of the accountant. - Indirect costs are related to the particular cost object but cannot be traced to it in an economically feasible way.
- Use these revision flashcards to support your preparation for mocks, other assessments and the final Edexcel A-Level Politics exams.
2.3 Describe how a given cost item can be both a direct cost and an indirect cost. 2.8 Describe how service-, merchandising- and manufacturing-sector companies differ from each other. 2.7 Explain why unit costs must often be interpreted with caution. Tutor2u’s series of cost-effective and specification-focused workbooks for GCSE and A-Level are essential teaching and revision aids throughout each course.
Revision Flashcards to Support GCSE and A-Level Students
Indirect manufacturing costs are all manufacturing costs that are considered to be part of the cost object, but that cannot be traced to that cost object in an economically feasible way. Other terms for this cost category include manufacturing overhead costs and factory overhead costs. Unit costs of a cost object should be interpreted with caution when they include a fixed-cost component. When making total cost estimates, think of variable costs as an amount per unit and fixed costs as a total amount. Which of the following statements best
describes ethical guidance in the UK? A Ethical guidance provides a set of
rules which must be followed in all
circumstances.