Question 1

The total of direct material cost, direct labour cost, and direct expenses is known as total product cost. Indicate whether this is true or false.

Question 2

Green Cars Ltd in manufacturing electric cars believes that there is a type of cost that increases with the number of cars manufactured. What is the type of cost that Green Cars Ltd is thinking of?

Question 3

In calculating the cost of producing a microchip, Best Technology Ltd considers the fixed production overheads as part of the product cost. State the costing method being adopted by Best Technology Ltd.

Question 4

Jane Benson has explained to her team of management accountants that overhead apportionment means spreading common costs over cost centres based on the benefit received. Indicate whether Jane Benson is right or wrong