Question

I write ‘ True’ it the statement is correct and ; false’ if the statement in correct

1. The higher one operational costs are one higher one profit
2. Double entry principle is applied in one case of management accounting
3. Direct costs are costs mat can be directly traced to a cost object in an economically feasible way
4. Production order are a manufacturer can produce in response to a customer order or just for stock
5. The use of applied overhead cost are accurate as the actual overhead costs
6. In process costing system , manufacturing cost direct materials direct labor & manufacturing overhead costs are accumulated in one some way
7. A cost transferred form a preceding department is called transferred in cost
8. Net reliable value is measure of a products contributions to profit after the split off paint and is computed as one difference of sales revenue less further processing cost
9. Unlike direct materials and direct labor, factory overhead is an invisible part of the finished product
10. When there are boon beginning and ending work in process inventory it is important to assume as to the flow of cost

Answer 1

The answers address whether certain statements related to business, accounting, and cost management are true or false, providing a basic understanding of cost concepts and their impact on profit. The answer to the statements are: 1)False, 2) False, 3)True, 4) True, 5) False, 6)True, 7)True, 8) False, 9)True, 10)True.

Step-by-step explanation:

The answers to the statements are based on concepts of accounting and cost management:

1. False. The higher one's operational costs are, the lower one's profit, as profit is total revenue minus total cost.
2. False. Double entry principle is a fundamental concept in financial accounting, not just one case of management accounting.
3. True. Direct costs are costs that can be directly traced to a cost object in an economically feasible way.
4. True. Production orders are how a manufacturer can produce in response to a customer order or for stock.
5. False. Applied overhead costs are estimates and may not be as accurate as actual overhead costs.
6. True. In a process costing system, manufacturing costs such as direct materials, direct labor, and manufacturing overhead costs are accumulated in a uniform way.
7. True. A cost transferred from a preceding department is called a transferred-in cost.
8. False. Net realizable value is the measure of a product's contributions to profit and is computed as the difference between sales revenue and the total cost until the split-off point, not just further processing cost.
9. True. Unlike direct materials and direct labor, factory overhead is not directly observable in the finished product.
10. True. When there are both beginning and ending work in process inventory, it is important to make assumptions about the flow of costs.

Understanding these concepts helps to distinguish between accounting profit and economic profit, and the implications on a firm's success.