23.01.27 Costing

Materials, labour and expenses. By which method have these costs been classified?

• Nature

• Behaviour

• Element

• Function

Fixed costs...

• ... remain constant in total over a range of output levels but the cost per unit falls as output increases

• ... per unit stay the same as output levels change

Variable costs...

• change in cost per unit terms as output changes

• ... in total change directly with the changes in output levels but the cost per unit stays the same

Under IAS 2, how should we value inventories?

• At the higher of cost and net realisable value

• At the lower of cost and net realisable value

Under FIFO, once we have issued stock to the factory, the stock left in the stock room will be

• the newest

• the oldest

Under LIFO, the stock that we issue to the factory will be

• the newest

• the oldest