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Service Costing

Forums › FIA Forums › MA2 Managing Costs and Finance Forums › Service Costing

  • This topic has 2 replies, 2 voices, and was last updated 1 year ago by maximus07.
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  • August 24, 2021 at 4:59 pm #632778
    maximus07
    Participant
    • Topics: 407
    • Replies: 398
    • ☆☆☆☆

    When is service costing used?

    A When overhead absorption is straightforward
    B When indirect costs are a small proportion of total costs
    C When the output is intangible
    D When the absence of a physical product makes it impossible to determine unit costs

    Answer C.
    Why D is incorrect?

    August 24, 2021 at 8:28 pm #632799
    Ken Garrett
    Keymaster
    • Topics: 10
    • Replies: 10193
    • ☆☆☆☆☆

    D: yes, I service costing there is no physical product, but the cost of a curious of service can be determined.

    For example, a laundry can calculate how much it costs to wash a single sheet, double sheet, shirt etc.

    August 25, 2021 at 1:52 pm #632866
    maximus07
    Participant
    • Topics: 407
    • Replies: 398
    • ☆☆☆☆

    Right sir. 🙂

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