Costing

✅ The correct answer is C.
Prime cost = Direct material cost + Direct manufacturing labour
= $75000 + $20000 = $95,000

✅ The correct answer is B.
Stage in production process, where manufactured goods are checked; whether units are acceptable or not is classified as inspection point. An inspection point is an identifiable record of inspection results that is assigned to a work or inspection operation.

✅ The correct answer is B.
Direct labour and salary outlays direct material purchases, which are classified as cash disbursements. Cash disbursements, also called cash payments, in accounting refer to payments made by a company during a specified period, such as quarter or year.

✅ The correct answer is D.
In a machine dominated industry Machine hour method of overhead absorption is suitable. Under this method, hourly rate of depreciation is calculated. The cost of the asset (less residual value if any) is divided by the estimated working hours. The actual depreciate for any given period depends upon the working hours during that year.

✅ The correct answer is A.

✅ The correct answer is B.
An allocation approach, in which all overhead entries are restated using actual cost rates in place of budgeted rates is called adjusted allocation rate approach. The adjusted allocation-rate approach restates or corrects estimated overhead costs booked throughout the year, so that the actual overhead costs are recorded properly.

✅ The correct answer is C.
Industrial engineering method is used to analyze relationship between input and output. Industrial engineering method is a physical way of examining the relationship between cost drivers and costs by analyzing the inputs coming into the company, the outputs that are created, and the work that goes into the process.

✅ The correct answer is C.
Model which states decline in extra time needed to produce last unit, every time for cumulative quantity of doubled units produced is classified as incremental unit time learning model. Incremental unit-time learning model can be defined as Learning curve model in which the incremental unit time (the time needed to produce the last unit) is reduced by a constant percentage each time the cumulative quantity of units produced is doubled.

✅ The correct answer is C.
Flexible budget = Actual result – Flexible budget amount
= $26000 – $13000 = $13,000

✅ The correct answer is C.
Conversion cost is subtracted from manufacturing overhead cost is to calculate the direct manufacturing labour costs. Conversion costs is a term used in cost accounting that represents the combination of direct labor costs and manufacturing overhead costs.