Why base measurement on historical costs?

Q: What are transferred in costs? When do they occur?

A: Transferred in costs: Cost that is assigned to partially completed products that have been finished…

Q: what is an indirect cost and how is it different than a direct cost?

A: Indirect Cost: Indirect costs are the costs of doing business that are not easily identified with a…

Q: Understand thedifferences between directand indirect costs

A: Cost:   It refers to the economic value incurred by an organization for manufacturing a product or…

Q: What is meant by relevant costs and there use in making short-term decisions?

A: Cost refers to the amount of expenditure incurred by an individual or an entity in relation to goods…

Q: What is the economic rationale for the cost approach? Under what conditions would the cost approach…

A: Answer: Economic rationale for cost approach: The cost approach means that the person who is…

Q: Explain any one pros and cons of historical cost.

A: Historical cost is one of the four basic accounting principles. This method is used under Generally…

Q: Describe why base measurement on historical costs?

A: Definition: Historical cost: Historical cost explains that assets and liabilities appear in the…

Q: How are costs assigned differently using the average cost method?

A: Inventory valuation is the valuation of inventory at the time of its purchase and sale using…

Q: what is weighted average cost method?

A: The weighted average cost method is one of the methods to ascertain the unit cost of a product. It…

Q: How does an engineered cost differ from a discretionary cost?

A:

Q: Why opportunity cost is measured and relate with the evaluation of alternative, can it be an…

A: Cost or expenditure is the total amount spent by an individual, group and company to make a finished…

Q: How is life-cycle-cost analysis useful?

A: Life Cycle Costing (LCC) is a process of accounting which is used by the owner or management of an…

Q: What does it mean to externalize costs?

A: Externalizing costs means generating profits by reducing the indirect costs by imposing them on…

Q: What is the correlation between fixed, variable, and semi-variable costs??

A: Introduction:- Fixed Costs – Costs are same irrespective of the number of output produced Variable…

Q: What is the difference between prime costs and conversion costs?

A: Prime cost includes direct expenses related to Manufacturing of a goods. Major component of Prime…

Q: Which costs make up “prime” costs？

A: Prime cost is that cost, which is directly concerned with the product such as direct material,…

Q: How is contribution margin calculated?

A: Contribution margin means sales revenue over and above the variable costs of production and selling…

Q: What is the difference between total costs and marginal costs?

A: Total cost is the total economic cost of production. Variable cost changes according to the quantity…

Q: Define prime costs?

A: Cost accounting is the branch of accounting that inspects the cost structure of a business. This…

Q: Define historical costs.

A: Historical cost principle: This is an accounting principle which states that the actual cost paid in…

Q: Explain Historical Cost Principle in detail with example.

A: In bookkeeping, we may utilize four adequate estimation bases. These are the historical expense or…

Q: What connection exists between unit profit and labor costs?

A: A cost is the amount of money that was expended during the production or delivery of a good or…

Q: What are the prime costs? Conversion costs?

A: Prime cost: Prime cost includes cost which are related to direcly production of Finished goods. This…

Q: Discuss the difference between the revaluation model and cost model in detail.

A: Revaluation model and cost model are two different models of subsequent measurement of invested…

Q: How should mixed costs be classified in cost, volume, and profit analysis?

A: Based on the cost behaviour costs are classified as fixed costs , variable costs and mixed costs.…

Q: What does the Contribution margin equation express?

A: Break Even Point:                 Break Even Point is defined as the level where there is no profit…

Q: What are “initial direct costs” and how are they accountedfor?

A:

Q: cost benefit model

A: The benefit under the cost-benefit model is calculated by deducting the associated cost from the…

Q: Why is it essential to determine unit costs or profits?

A: Determining unit cost means to find out total cost incurred on a particular unit It is determined by…

Q: Define Historical cost principle.

A:

Q: what is meant by Capitalized cost?

A: Capitalized cost is a cost which is incurred in purchasing the fixed asset or making the fixed asset…

Q: What are sunk costs? Give an example.

A:

Q: Define relevant costs. Why are historical costs irrelevant?

A: Relevant cost: A cost that is specific in the managerial decision making are called relevant cost.…

Q: ases? or only in t

A: The explanation is given below ,

Q: hould the costs be historical (embedded)costs or new (marginal) costs?

A: Historical cost is the original cost at which an asset was purchased by corporation and used in the…

Q: What are “initial direct costs” and how are they accounted for by lessees and lessors?

A: Initial Direct Costs: Initial direct costs refer to the costs that a lessor incurs directly while a…