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In relation to the above statement, describe three ways in which costs might be classified
according to behavior.
Variable costs
These are costs that increase or decrease, in total, in direct proportion to changes in the total level
of activity or number of units produced i.e. that portion of the cost of an activity that change with
the level of output. They are costs which tend to vary directly with the levels of output.
Fixed Costs
These are costs whose total will tend to remain fixed irrespective of changes in output they do
not change with the level of output. They are also called autonomous costs, as they remain the
same irrespective of the activity level e.g. Salaries, rent etc.
Semi variable costs
These are costs with both a fixed and variable cost component. ie. They are fixed up to certain
output levels and thereafter increase and get fixed at higher levels. They are partially fixed and
partially variable
marto answered the question on February 15, 2019 at 07:41
- Afya Bora Health Centre has a capacity of 20 beds. The following information relates to the
centre's operations for the year ended 30 June 2014:(Solved)
Afya Bora Health Centre has a capacity of 20 beds. The following information relates to the
centre's operations for the year ended 30 June 2014:
Date posted: February 15, 2019. Answers (1)
- Cost accounting is often described as the provision of information required by management for
specific purposes'
Required:
State six of these specific purposes.(Solved)
Cost accounting is often described as the provision of information required by management for
specific purposes'
Required:
State six of these specific purposes.
Date posted: February 15, 2019. Answers (1)
- Daniel Mutiso, the Cost Accountant of Abra Ltd. feels that he is getting overworked and has
recommended that a management accountant be employed to take up...(Solved)
Daniel Mutiso, the Cost Accountant of Abra Ltd. feels that he is getting overworked and has
recommended that a management accountant be employed to take up other responsibilities in the
organization.
However, the management of the company equally argues that the work is the same and that a
decision to hire a management accountant is against their cost reduction policy.
Required:
In the light of the above statement, explain to the management three differences between management
accounting and cost accounting to help them make a fair decision.
Date posted: February 15, 2019. Answers (1)
- Describe five ways in which cost accounting complements financial accounting in terms of
providing information to managers for better decision making.(Solved)
Describe five ways in which cost accounting complements financial accounting in terms of
providing information to managers for better decision making.
Date posted: February 15, 2019. Answers (1)
- The success of an organisation in cost control and cost reduction depends largely on the
installation of an ideal cost accounting system which identifies, classifies and...(Solved)
The success of an organisation in cost control and cost reduction depends largely on the
installation of an ideal cost accounting system which identifies, classifies and records all costs
accurately and promptly.
Required;
With reference to the above statement, explain four conditions for an effective costing system.
Date posted: February 15, 2019. Answers (1)