Costing

✅ The correct answer is B.
All costs, which are assigned to manufactured products for specific calculations are classified as product cost. Product cost refers to the costs incurred to create a product. These costs include direct labor, direct materials, consumable production supplies, and factory overhead.

✅ The correct answer is D.
Number of observations in regression analysis is considered as degree of freedom. In a regression model, each term is an estimated parameter that uses one degree of freedom. In the regression output below, you can see how each term requires a DF.

✅ The correct answer is A.
Final sales is subtracted from net realizable value is used to calculate separable costs. The net realizable value method allocates joint costs on the basis of the final sales value less separable costs.

✅ The correct answer is B.
Directors remuneration and expenses form part of administrative overhead. Administrative overhead includes the expenses related to the administration and general operations of the business.

✅ The correct answer is D.
Manufacturing overhead cost allocated to individual jobs is classified as manufacturing overhead allocated and manufacturing overhead applied.

✅ The correct answer is C.

✅ The correct answer is A.
Direct labour means labour which can be conveniently associated with aparticular cost unit. Direct Labour cost consists of wages paid to workers directly engaged in manufacturing or handling a product, job or process.

✅ The correct answer is B.
Sales budget variance = Flexible budget – Static budget
= $305000 – $208000 = $97,000

✅ The correct answer is A.
Spread of over allocated overhead and under allocated overhead among work in process, finished goods and goods sold cost is classified as proration approach.

✅ The correct answer is D.
Method which ranks cost object incurred by individual users, in ranking order of more responsible users is classified as incremental cost allocation method. Cost allocation methods are designed to allocate costs not necessarily associated with a product, to the appropriate products to get a realistic estimate of costs so that a proper price can be determined for a particular product.