Classification of Costs and Cost sheets

Form of specific order costing where work is undertaken to customer's special requirements and each order is comparatively of short duration.

• Job Order Costing

• Batch Costing

• Contract Costing

• Process Costing

Which one of the following items is not excluded while preparing a cost sheet?

• Goodwill written off

• Provision for taxation

• Property tax on factory building

• Transfer to reserves

A company has to pay Rs. 10,000 per unit royalty to the designer of a product which it manufactures and sells. The royalty charge would be classified as a

• Direct expense

• Production overhead

• Administrative overhead

• Selling overhead

Research and development cost relating to an existing product

• shall be treated as Capital Expenditure

• shall be treated as deferred revenue expenditure

• shall be treated as Direct Expenses

• shall be ignored

Which of the following is not a component of prime cost?

• Direct materials

• Direct labour

• Direct expenses

• Overhead

Recruitment costs

• shall form part of Prime Cost

• shall form part of Works Cost

• shall form part of Overheads

• shall be ignored

In the cost sheet, abnormal costs eg. due to accident shall be

• added to cost of production

• deducted from cost of production

• deducted from sales

• ignored

Prime Cost + Factory Overhead =

• Fixed Cost

• Works Cost

• Cost of Production

• Cost of goods sold

Total Cost - Selling and distribution overheads =

• Cost of goods sold

• Closing stock

• Cost of production

• Net Profit

Cost of Production - Administration Overheads =

• Prime Cost

• Cost of Sales

• Works Cost

• Work- in- Progress