concerning ABC (activity-based costing) and ABM (activity-based management): i. ABM can be used with value chain analysis ii. ABC cannot be used in the service industries iii. ABC is used in conjunction with ABM iv. The ABC approach assumes that costs occur in proportion to production volume Which of the above statements is (are) true? Multiple Choice i and iii iii and iv ii and iii i, iii and iv i and ii
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Consider the following statements concerning ABC (activity-based costing) and ABM (activity-based management):
i. ABM can be used with value chain analysis
ii. ABC cannot be used in the service industries
iii. ABC is used in conjunction with ABM
iv. The ABC approach assumes that costs occur in proportion to production volume
Which of the above statements is (are) true?
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i and iii
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iii and iv
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ii and iii
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i, iii and iv
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i and ii
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